Nomura: Upgrades Bilibili's rating to 'Outperform' and lowers target price to HKD 120

On August 26, Jinshi Data reported that Bilibili (09626.HK) achieved a stable performance in the second quarter, with adjusted net loss narrowing by 72% YoY, exceeding market expectations by 18%. The bank’s expectation of a return to profitability in the third quarter has become more solid, and its H-share rating has been upgraded from ‘hold’ to ‘outperform the market’. The reasons include the expected narrowing of losses, strong advertising momentum, and steady expansion of gross profit margin for eight consecutive quarters. Daiwa has raised Bilibili’s earnings forecast per share for 2025 to 2026 by 12% to 15%. As Bilibili is expected to achieve a balance between revenue and expenditure in the third quarter, the valuation basis has been changed from market-to-sales ratio to price-to-earnings ratio, and the target price for H-shares has been lowered from HK$137 to HK$120.