On November 28th, Pinduoduo released its performance report for the third quarter of 2023 as of September 30th. The quarterly revenue was 68.84 billion yuan, a year-on-year increase of 93.9%. Among them, online marketing services and other revenue was 39.69 billion yuan, a year-on-year increase of 39%; The transaction service revenue was 29.15 billion yuan, a year-on-year increase of 315%. Meanwhile, Pinduoduo achieved a net profit of 15.54 billion yuan under the US GAAP standard, with a net profit margin of 22.6%.
After the financial report was released, Pinduoduo closed up more than 18% and its stock price reached a new high in 31 months, with a total market value of $184.7 billion, just over $10 billion away from Alibaba's total market value of $195.2 billion.
The promotion of cross-border e-commerce business may be an important reason for Pinduoduo's rapid revenue growth in the third quarter of this year. Data shows that in the third quarter of this year, Pinduoduo accelerated the improvement of its cross-border business models, and advanced the layout of overseas consumption nodes such as Halloween, Christmas, and Black Friday, helping more than 10000 factories in over 100 industrial belts in Guangdong, Zhejiang, and other regions accelerate their overseas expansion.
"Since the third quarter of last year, Duoduo Cross border has been launched for over a year, reaching more than 40 countries and regions worldwide." Pinduoduo Chairman Chen Lei said, "We hope to use the supply chain foundation accumulated over the past years to provide consumers from different regions of the world with a direct channel to purchase from factories, a more flexible and personalized supply chain, and a more cost-effective comprehensive shopping experience."
The analysis also believes that Temu under Pinduoduo and TikTok under ByteDance are rare Internet giants in China that can make breakthroughs in overseas markets and still have growth potential. This is why Pinduoduo can still be recognized by the market during the cold winter of Chinese concept stocks.
The Dolphin Investment Research Briefing points out that the market needs to gradually price Temu's valuation into Pinduoduo's valuation. The briefing believes that Pinduoduo's Q3 revenue exceeded market expectations by 14 billion yuan, which only indicates that Temu's overseas performance is good, as Pinduoduo's domestic revenue is relatively clear.
According to data released by AppMagic, Temu became the sixth most downloaded app in the world in August this year. According to data from mobile insight consulting firm GWS, Temu has added nearly 10 million new users every day since January, and there is no sign of a slowdown in this growth rate. CICC predicts that Temu's GMV will reach $18 billion in 2023, equivalent to 60% of Shein's 2022 GMV.
Haitong International Research Report believes that TEMU is still in a high growth stage, and its growth rate is somewhat comparable to SheIn. Referring to SheIn's GMV growth rate of about 50% in 2022, the post investment valuation in 2022 was close to $100 billion, with a P/GMV of 3.2 times that year and a forward P/GMV of 2.2 times; Considering that the overall valuation level of Chinese concept stocks has declined, a 20% discount will be given based on SheIn's valuation level that year, using a 1.8x forward P/GMV valuation for TEMU. The latest TEMU GMV forecast is $12 billion for the entire year of 2023, which will double next year to reach $24 billion. If a multiple of 1.8 P/GMV is used, it will contribute $43.2 billion to the market value, corresponding to a target contribution price of $32.