Macquarie has released a report indicating that Chinese consumers are increasingly participating in trade-in programs, alongside benefiting from JD.com's enhanced promotional activities. These factors are expected to drive JD.com's retail revenue up by 11% year-over-year in the fourth quarter of the 2024 fiscal year. Additionally, profit margins are anticipated to improve steadily, with adjusted operating profit margins increasing by 50 basis points to 3.1% year-over-year.
For the overall group, Macquarie forecasts JD.com's adjusted net profit margin to rise by 30 basis points to 3%. This growth is primarily attributed to the robust profitability of JD Logistics and increased investment in new business ventures.
Macquarie has revised JD.com's earnings forecasts for the 2024 and 2025 fiscal years, raising them by 4% and 3%, respectively. Furthermore, the target price for JD.com's American Depositary Receipts (ADR) has been increased from $57 to $59, while the target price for the H-shares has been raised from HKD 217 to HKD 225. Both are given an "outperform" rating.
