CICC has kept its earnings forecasts for JD Logistics (02618) unchanged for 2025 and 2026. The current stock price implies 8.7x/8.0x non-IFRS P/E for 2025/2026. The firm reiterated an "Outperform" rating, shifting valuation to 2026, citing confidence in the company's long-term growth potential. The target price of HK$18.50, representing 13.6x/12.5x non-IFRS P/E for 2025/2026, suggests a 56.5% upside from the current price.
Key highlights from CICC's analysis:
**3Q25 Results Meet Expectations** JD Logistics reported 3Q25 revenue of RMB55.08 billion (+24% YoY), with non-IFRS net profit at RMB2.02 billion and a non-IFRS net margin of 3.7%. The results aligned with expectations, driven by full-time riders participating in JD’s food delivery services and growth in the group’s retail business.
**Integrated Supply Chain Business Shows Strong Growth** Integrated supply chain revenue rose 46% YoY to RMB30.1 billion in 3Q: 1. Revenue from JD Group surged 66% YoY to RMB21.2 billion, boosted by incremental income from JD’s food delivery services and retail expansion. 2. External integrated supply chain revenue grew 13% YoY to RMB8.9 billion, with customer count and per-customer revenue up 13% and 1%, respectively, reflecting steady service capability improvements.
Other business revenue reached RMB24.9 billion (+5.1% YoY), supported by stable growth in express and freight volumes.
**Strategic Moves to Enhance Growth** 1. **Local Fulfillment**: On October 9, JD Logistics announced the acquisition of Dada’s local on-demand delivery business for approximately $270 million, expected to complement its product offerings and optimize last-mile delivery. 2. **Overseas Expansion**: The company is rapidly scaling its overseas warehouse network. In 3Q25, it partnered with a new energy vehicle manufacturer to expand into the Middle East, providing warehousing and integrated logistics services. This segment is poised to become a secondary growth driver.
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