SHANGHAI, 22 Feb – Growth for China’s food delivery giant Meituan has peaked as competition heats up in the US$145bil (RM642.5bil) industry, says a China tech analyst, who is the lone bear on the Hong Kong-listed stock.
“Other players will start to take shares from Meituan – this becomes especially so when there’s a lack of growth anywhere in the industry,” Barclays Plc’s Jiong Shao, the only analyst who has a “sell” call on the stock, said in an interview with Bloomberg News last week.
China’s food delivery market – the world’s biggest – feasted on surging demand for takeouts during Covid lockdowns.
However, Shao said that there is limited growth potential now that the country has reopened.
The competition is also heating up as other tech firms, including ByteDance Ltd, expand their efforts into the delivery space.
The company missed out on a sizzling rally in China’s tech industry after the nation dropped restrictions and eased its regulatory stance towards Internet giants.
Meituan’s shares have slumped 17% this year and are the worst performer on the Hang Seng Tech Index.
Shao has kept his contrarian “underweight” rating on Meituan ever since he initiated coverage in November 2021.
The call returned 23% over the past year, beating every other analyst.
