InvestIdeas

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JD.com (9618 HK)
Expecting Solid Revenue Growth; Limited Impact From Rmb10b Subsidy

JD will report its 4Q22 earnings on 9 March.

We expect the recovery of JD’s top-line performance to continue in 1H23 and move into growth trajectory in 2H23.

The competitive landscape has become increasingly intense along with the economic recovery.

According to 36Kr report, JD will launch the "Rmb10b subsidy" campaign in March - under our scenario analysis, the impact of this should be limited.

Maintain BUY with target price of HK331.00 (US$87.00).

Source: UOBKH

https://research.uobkayhian.com/content ... f146486c0b

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China's JD.com Beats Fourth-Quarter Sales, Earnings Targets

by BRIAN DEAGON

On a year-over-year basis, JD earnings jumped 100% while sales advanced 7%.

Source: IBD

https://www.investors.com/news/technolo ... src=A00220

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JD.com returns to the black

Chinese e-commerce firm JD.com (9618) swung to a net profit of 10.4 billion yuan (HK$11.72 billion) last year from a loss of 3.6 billion yuan in 2021 and proposed a 31 US cents (HK$2.418) dividend.

Adjusted net income jumped 64 percent year-on-year to 28.2 billion yuan as revenue rose 9.9 percent to above 1 trillion yuan for the first time at 1.05 trillion yuan.

Gross merchandise value increased by 5.6 percent and net service revenues soared by 33.3 percent.

Sales of its retail business grew 7.3 percent to 929.93 billion yuan and that of JD Logistics (2618) surged by 31.2 percent to 137.4 billion yuan.

The logistics segment narrowed its net loss by 91 percent to 1.4 billion yuan in 2022. Adjusted net profit was 866 million yuan, compared to an adjusted loss of 1.23 billion yuan.

The group's fourth-quarter net profit was 3 billion yuan, compared to a 2.9 billion yuan estimate and a net loss of 5.2 billion yuan a year ago. Adjusted net profit more than doubled to 7.7 billion, also beating estimates.

Quarterly sales, however, only rose 7 percent to 295.4 billion yuan, slightly below the 295.5 billion yuan average of analysts' projections.

Bloomberg Intelligence analyst Catherine Lim and Trini Tan said JD.com's plan to offer 10 billion yuan worth of subsidies to shoppers on its platforms, could lift average spending per active user and attract new customers this year. They said this may help the firm meet consensus expectations for an acceleration in revenue growth to 15 percent in 2023 versus about 10 percent the prior year.

Source: Bloomberg

https://www.thestandard.com.hk/section- ... -the-black

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China's JD.com warns consumer confidence will take time to rebuild

by Yuvraj Malik & Sophie Yu

Rebuilding consumer confidence would take time after the lifting of strict pandemic-related curbs late last year, as it missed fourth-quarter revenue forecasts.

"The core is the recovery in consumer's income".

Online direct sales revenue in the quarter grew 1% year on year, missing analysts consensus forecast of 4%.

"The softness was primarily due to weakness in electronics and home appliances as a result of Covid disruption as well as softer property market".

Competitors: PD, Alibab, Douyin (owned by ByteDance) and Tencent-backed Kuaishou.

Winding down its e-commerce business in Indonesia and Thailand, where it faced stiff competition from Sea Ltd-owned Shopee.

Source: Reuters

https://www.theedgemarkets.com/node/658550

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JD.com (9618 HK)

4Q22: Solid Earnings Beat, Soft 1Q23 Outlook; Rmb10b Subsidy As The Key Market Focus

JD’s 4Q22 earnings beat with non-GAAP net profit of Rmb7.7b, 38% above the street’s estimate,
as a result of improving operating efficiency.

Revenue grew 7% yoy to Rmb295.4b, in line with our and the street’s estimates.

Management expects JD Retail’s EBIT margin to remain stable and group margins to expand for 1Q23/2023 despite the Rmb10b subsidy programme, thanks to the narrow losses from new businesses.

We maintain BUY on JD with a lower target price of HK$287.00 (US$77.00).

Source: UOBKH

https://research.uobkayhian.com/content ... 2db0418b80

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Brokers│Views

Jefferies│JD-SW's fundamentals expected to improve this year

CLSA│RMB10 billion subsidy campaign expected to have minimal impact on profit margin

Citigroup│4Q22 product sales volume missed forecast; revenue growth visibility low due to promotion campaign

Goldman Sachs│Cautiously optimistic towards 2023 recovery; 2H23 growth expected to be better than 1H23

UBS│4Q22 revenue in line with estimate-beating profit margin

Morgan Stanley│4Q22 revenue growth in line with estimate-beating profit margin

HSBC Global Research│Uncertainties already reflected on share price

JPMorgan│Negative share price reaction projected due to enervated core revenue

Related NewsJD-SW 4Q22 Non-GAAP Net Income Soars Over 1.1x; US Shrs Up 1.6% Pre-mkt

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... t-news/HK6

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JD.com Inc (9618 HK/JD US)

4Q22 core earnings beat due to cost control, lack of transparency on subsidy scheme (-ve)

Revenue grew by 7% y-o-y to Rmb295bn, with JD retail increasing by 4%

Net-GAAP net profit increased by 115% to Rmb7.7bn, above market expectations of Rmb5.5bn, mainly due to cost control

Started paying out annual dividend of US$0.62 per ADS for FY22, or 1.3% dividend yield

Despite the stronger-than-expected 4Q earnings, near-term sentiment could be negatively affected by the weaker-than-expected JD retail growth and lack of transparency on subsidy scheme

Our View:

We expect near-term share price pressure due to the weaker-than-expected JD retail growth and lack of transparency on subsidy scheme.

Management shared that descretionary spendings still needs some time to recover, and mentioned limited margin impact from subsidy scheme, but did not provide timeline or GMV guidance.

We expect investors might remain cautious about top-line growth in the short term until the actual results of its subsidy scheme are known.

However, we remain confident about JD’s mid-long-term growth potential as it leverages its strong fulfillment capability and engages in continuous category expansion.

The company is trading at an undemanding valuation of 15x forward P/E, 2.4SD below the historical average. We currently rate BUY on the counter with TPs of HK$381/US$98.

Source: DBS

https://www.dbs.com/insightsdirect/comp ... ecid=13255

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Focusing on sustainable, high-quality growth

JD’s revenue reached Rmb1,046bn in FY22, up 10% yoy (up 7.1% yoy in 4Q22), hitting a record high, in line, driven by JDL’s 31.2% yoy and JDR’s 7.3% yoy growth.

Non-GAAP net profit reached Rmb28bn in FY22, up 64% yoy, beating our expectation, due mainly to better cost control and streamlining new businesses.

The first month’s investment for the Rmb10bn subsidy program is planned to be Rmb1bn, which will be shared with JD’s brand partners and merchants. Management guided that non-GAAP NPM would increase yoy in FY23F.

We expect revenue to grow by 6.8% yoy to Rmb1,118bn in FY23F, with GPM up by 0.4ppts to 14.4% and non-GAAP NPM reaching 2.9%, up 0.2ppts yoy, in FY23F.

Reiterate Add with a new DCF-based TP of HK$350.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 71EBC8C338

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JD.com shares dip on cautious outlook

13 Mar 2023

HONG KONG: JD.com Inc shares fell after the company reported a sharp drop in year-end revenue growth as Chinese shoppers reined in spending, and cautioned a recovery will take time.

China’s second-largest online retailer said revenue rose 7% from October to December, down from 23% growth a year earlier.

Total revenue may fall by 1% on year in the three months to March, according to Jefferies analyst Thomas Chong, who said the recovery in overall domestic consumption this quarter may be sluggish.

Like Alibaba and Tencent Holdings Ltd, JD faces intensified competition from up-and-comers such as PDD Holdings Inc and ByteDance Ltd, and has balanced tightened cost controls with targeted measures to shore up its market share.

Source: Bloomberg

https://www.thestar.com.my/business/bus ... us-outlook

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China's JD.com to spin off industrial, property units in Hong Kong float

HONG KONG (March 30): Chinese e-commerce firm JD.com Inc said on Thursday it planned to spin off its property and industrial units and list them on the Hong Kong Stock Exchange.

Upon completion of the proposed spin off of JD Logistics and JD Property, JD.com said it would continue to indirectly hold more than 50% of the shares in both units which will remain as subsidiaries of the company.

The company spun off its logistics unit into a standalone entity in 2017 and then opened up its delivery and warehousing services to third-party companies.

The Beijing-based company said in January it was winding down its e-commerce business in Indonesia and Thailand, where it faced stiff competition from Sea Ltd-owned Shopee.

Source: Reuters

https://www.theedgemarkets.com/node/661537