HSBC has reaffirmed its "buy" rating for JD.com (JD, Financial), setting a target price of $48. JD.com's first fiscal quarter revenue rose by 16% year-over-year to RMB 301 billion, surpassing HSBC and market expectations by 3-4%. Product sales increased by 16%, with electronics and home appliances growing by 17%, and daily necessities by 15%.
The company's service income rose 14% year-over-year, driven by market improvements. JD's gross margin reached 15.9%, marking a 0.6 percentage point increase year-on-year, exceeding expectations. Non-GAAP net profit was up 43% to RMB 12.8 billion, outperforming market forecasts by 23-25%.
HSBC forecasts a 15% year-on-year revenue growth for JD.com in the second quarter. The ongoing trade-in trend and reduced losses in the food delivery business (-21%) contribute to this positive outlook.
