＜Research＞Daiwa Downgrades AUTOHOME-S (02518.HK) to Outperform and Lowers TP to $60

　　A recent Daiwa report reveals that it has lowered the media service revenue forecast for AUTOHOME-S (02518.HK) -2.250 (-4.155%) by 12% for 2024, reflecting the impact of the price war among automakers. Daiwa expects the share price to be under pressure in the near term, but it believes that the companys net cash will offer downside support and investors will focus on the possibility of a special dividend. The broker estimates that the free cash flow of AUTOHOME-S amounts to at least RMB2 billion a year. A dividend of more than RMB1.5 billion is possible to be declared in 2024, with a dividend yield of at least 6%. Additionally, the possibility of a special dividend cannot be ruled out.

　　Daiwa expects the media service revenue of AUTOHOME-S to decline by 15% YoY in 2Q, mainly due to manufacturers' cautiousness about advertising budget allocation. However, the impact will be partially offset by a 5% YoY increase in leads generation services revenue. The full-year profit is expected to fall by 6% YoY.

　　Daiwa has downgraded the rating on AUTOHOME-S from Buy to Outperform and lowered its target price from $74 to $60.

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