The analyst rating for MEITU (01357.HK) was set to "Buy" with a target price of HKD12.5 due to several factors highlighted in Jefferies' research report. The projected growth in non-IFRS adjusted profit attributable to shareholders, expected to increase by 60-66% year-over-year, aligns with street consensus. This growth is attributed to rapid revenue increases in core businesses such as photo, video, and design products, driven by a significant rise in global paying users and overseas user growth that is outpacing the Chinese market. Additionally, the report notes that gross profit growth is expected to outpace operating expense growth, resulting in an operating leverage effect. The broker also sees potential in Meitu's ability to leverage AI productivity tools for long-term growth.
