UBS has released a research report indicating that consumer sentiment in China has stabilized since the launch of the home appliance trade-in subsidy policy late last year. JD.com (JD, Financial), a dominant player with a 60% gross merchandise value (GMV) share in home appliances and 3C electronics, is expected to outperform both the industry and the broader Chinese retail sector.
Looking ahead to 2025, the extension and expansion of the trade-in subsidies into other categories should alleviate concerns about JD.com's revenue growth this year. The penetration rate among consumers and product categories continues to have room for improvement.
UBS reaffirms JD.com as its top pick in mainland China's e-commerce sector, citing low market expectations, reasonable valuation, and potential upward momentum from macroeconomic stimulus measures. The bank maintains a "buy" rating with a target price of $64 for JD.com's U.S. shares.
