Finance Associated Press, April 29 (Editor Zhou Xinyang) Founder Securities on Friday (April 29) to study, dismantle and perspective on the investment layout of the five Hong Kong Internet giants.
The five companies are Alibaba (09988.HK), Baidu (09888.HK), Tencent (00700.HK), JD.com (09618.HK), and Meituan (03690.HK).
Each foreign investment serves more of its own main business and upstream and downstream layout
Tencent has more layouts in the game field, Meituan focuses on investing in local life, Alibaba and JD.com focus on the layout in the e-commerce field, and JD.com will also focus on investing in logistics companies to enhance its own supply chain advantages.
New tracks and new outlet Internet giants will also use the advantages of funds to layout
For example, in the new energy track with high prosperity, Tencent and Ali have invested in Weilai, Xiaopeng and Ideal respectively, the main reason is that new energy vehicles are not only power system changes, but also potential huge traffic entrances in the future, so the advance layout is conducive to obtaining a first-mover advantage.
Such investments generally do not directly help the development of the company's main business in the short term, but in the long run, they may develop in synergy with other sectors of the company.
In recent years, Internet giants have begun to invest in high-tech fields such as semiconductors and robots. For example, Meituan has invested in chip companies such as Rongxin Semiconductor and Aixin Technology, and ByteDance has invested in hard technology companies such as Juxin Microelectronics, Yunmaixinlian, and Dahuan Robot.
On the one hand, such investment can reflect the attitude of enterprises to embrace the industrial Internet and obtain certain financial returns, on the other hand, it can also help the development of the main business in the future.
To B market space is vast Giant investment increased
Internet Fundamentals To C-end: The population ceiling determines the upper limit of traffic growth, and share competition is becoming more and more important.
The population growth rate of the mainland has declined, there is a ceiling for ToC Internet traffic, and Internet giants are focusing on competing for market share.
For example, the natural population growth rate of the country will drop to 0.34 ‰ in 2021, the lowest since 1960.
By the end of 2021, the merger of WeChat at home and abroad is about 1.27 billion, and the annual monthly active growth rate has dropped from 40.85% in 2014 to 3.53% in 2021, and the future growth of MAU is expected to remain low.
The ToB market is to be developed, and the major giants have comprehensively laid out the ToB track from the main business to the investment, but the current domestic market maturity is not high.
On the one hand, due to the disappearance of the Internet demographic dividend and the peak of mobile Internet traffic, Internet companies have set their sights on the industrial Internet.
On the other hand, China has a large number of enterprise user base, according to the State Administration of Market Regulation data, from 2012 to 2021, the number of private enterprises in China increased from 10.857 million to 44.575 million, the proportion of private enterprises in the total number of enterprises increased from 79.4% to 92.1%, China has a large number of enterprise user base, which does not include a large number of party, government and military departments and institutions at all levels.
Overall, the five Internet companies have invested more in the field of corporate services.
For example, Alibaba and Baidu, investment in the field of enterprise services accounted for more than 40% of the total investment.
Tencent, ByteDance and JD.com are also gradually making efforts in 2017-2021, for example, the number of tencent's investment companies in the field of enterprise services will reach 74 in 2021 alone.
The above data does not include related investments in other ToB fields, such as artificial intelligence and financial services, and the overall number and proportion of investment in The ToB field is still even larger.
Opportunities in overseas markets
Game field: In recent years, domestic manufacturers have made great breakthroughs in going overseas, and the United States and Japan are the main markets for going overseas.
In 2021H1, the market share of overseas mobile games for Chinese developers reached 23%, ranking first in the world, an increase of 13% over 2017. In 2021, the revenue of the overseas game market reached 18.013 billion US dollars, an increase of 16.59% year-on-year, of which about 33% and 18% of the revenue came from the United States and Japan.
In the top 10 video games that were most discussed on Twitter in 2020-2021H1, 3 were from China, namely the original god, the idol dream festival, and the wilderness operation.
At present, the approval of domestic game version numbers is relatively strict, and the game going to sea is a more certain growth point for game manufacturers in the future.
Cross-border e-commerce: In recent years, cross-border e-commerce has been in a stage of rapid growth, and the total import and export volume of cross-border e-commerce has ushered in an outbreak after the epidemic.
In 2019-2021, the total import and export volume of cross-border e-commerce in China will be 1862, 16900 and 1980 billion yuan respectively, and the domestic epidemic control will be relatively effective after the outbreak of the epidemic, and the overall supply chain will remain stable, providing opportunities for cross-border e-commerce business. In addition to the epidemic factor, the development of e-commerce in various regions of the world is at different stages, which also provides opportunities for domestic cross-border e-commerce.
According to eMarketer's forecast, the growth rate of e-commerce retail sales in Southeast Asia and Latin America will reach 20.6% and 20.4% in 2022, far higher than the global average of 12.2%.
The mainland is currently in a relatively mature stage of e-commerce development, and e-commerce companies that have experienced fierce domestic competition have a greater winning rate in overseas markets.
Specific investments differ
Alibaba's investment focuses on e-commerce, cloud computing and local life, and the investment is mainly to consolidate its e-commerce moat.
For example, Suning Tesco, Lazada (focusing on Southeast Asia), Trendyol (Turkish e-commerce), etc., which have previously invested in the e-commerce field, are all aimed at enhancing their e-commerce business capabilities.
In addition to e-commerce and local life areas, financial consulting and medical health are also the focus of its layout, for example, in the field of medical health, it has also invested in deer traditional Chinese medicine, zero kr technology, and magnesium health to supplement its layout in the big health sector.
Baidu has a wide range of investment fields, and has been laid out in The Internet Technology, Transportation, Culture and Entertainment and other sectors.
In the field of Internet technology, Baidu owns companies such as Éridie, Feiteng, and Jimi Technology.
In terms of transportation, Baidu also invested in WM Motors, and in January 2021, it also established a new energy electric vehicle brand Jidu Automobile through cooperation with Geely.
In the cultural and entertainment sector, Baidu has invested in companies such as YY Live and Xinchao Media.
Founder found that Tencent's layout in recent years has the following characteristics:
Reduce e-commerce investment, WeChat vigorously develop mini programs and video numbers.
Tencent significantly reduced its stake in traditional e-commerce giants such as JD.com in 2021. In addition to avoiding the risk of touching the red line of antitrust supervision, this also means that Tencent is weakening the way it intervenes in the e-commerce market with strategic investment.
Promote the transformation of traditional industries with the development of information technology, and strengthen ToB services such as cloud and enterprise services.
On the one hand, Tencent continues to improve its cloud and enterprise service business capabilities: as of 2021H1, Tencent Cloud ranks second in the domestic IaaS+PaaS public cloud market share of 11.2%, and it has also continuously improved its ability to collaborate between efficient office SaaS tools (enterprise WeChat, Tencent conferencing and Tencent documents).
On the other hand, we continue to take root in the consumer Internet and embrace the industrial Internet. For example, Tencent also actively invests in the chip field, such as Shanghai Flint, Beijing Microchip Perception, etc., to integrate industry resources.
Tencent's overseas investment field is relatively wide, and the number of companies is relatively large.
According to IT Orange data, as of December 24, 2021, Tencent has made 268 shots in 2021, 93 more than in 2020.
Tencent has also improved its ecological chain in various fields through investment holding: Previously, Tencent has successively invested in companies such as Didi, Tongcheng Travel, and Meituan that are not related to its main business, but as Didi, Tongcheng Travel, and Meituan land on the homepage of WeChat services, the forward-looking nature of Tencent's investment has gradually emerged.
JD.com has made more foreign investments in local life and e-commerce.
In the early days, JD.com's investment was biased towards serving its own e-commerce business, such as in 2014, through transactions with Tencent, tencent's e-commerce platforms such as Paipai.com and Yixun.com were used to divert traffic for its e-commerce business, and then in 2017, it cooperated with Tencent to acquire Vipshop to deepen JD.com's layout in the female consumer market.
However, in recent years, JD.com's investment has been more diversified, for example, in 2021, JD.com invested in the self-driving company Mushroom Car Union, elevator advertising giant Xinchao Media, and Beijing 3W, which provides café services for entrepreneurs, and the above investment is difficult to synergize with JD.com's main business in the short term.
Meituan's early outbound investment mainly revolved around its core business, and its recent investment focused more on emerging businesses.
In 2013-2020, Meituan's investment style is business-driven investment, and its investment mainly focuses on enterprises that provide services related to core business, such as enterprise service providers (such as Different Red Cloud PMS, Dark Horse Software, etc.) and various vertical e-commerce companies related to their business (such as Hazelnut Homestay, Meicai.com, etc.).
After 2020, Meituan has invested in a number of popular areas such as car manufacturing, robots, and chips that are not strongly related to its own industry, such as Gaoxian Robot, Ideal Automobile, Rongxin Semiconductor and other companies.
The investment logic is in line with what Meituan CEO Wang Xing expressed in the conference call: In the long run, with the maturity of electric vehicles and automatic driving technology, the continuous improvement of cargo distribution efficiency and the continuous reduction of distribution costs will be conducive to the development of Meituan's main business.