Jinwu Financial News | According to the CITIC Construction Investment Research Report, JD Group (09618) revenue is expected to increase 6.2% year on year to 257.9 billion yuan in 2024Q1, JD retail revenue will increase 6% year on year to 25.1 billion yuan, and JD Group's non-GAAP net profit will be 7.284 billion yuan, corresponding net interest rate of 2.82%, compared to 3.12% for the same period of the previous year. Domestic macroeconomic and consumption recovered steadily this quarter. At the same time, compounded by last year's New Year's Festival's low base and JD's return to the Spring Festival Gala, the company's GMV and revenue growth continued to pick up. On the profit side, considering the 10 billion subsidy, the base issue after the free shipping threshold was lowered, and the impact of JD's sponsorship of the Spring Festival Gala, the profit margin for this quarter is expected to be about 3.7%, down year on year, but this year, due to the low price strategy, the user acquisition and retention effects brought about by the Spring Festival Gala event may be more positive.
Looking ahead to 2024, it is expected that the absolute profits of retail and the Group as a whole will remain steady. In the year of investment, it is recommended to focus on revenue side growth rate and changes in market share compared to profit. In the long run, the construction of JD's POP ecosystem continues to advance, platform merchants continue to pour in, and the share of 3PGMV is expected to further increase, thus boosting the profit margin flexibility of JD's main retail business.
The bank estimates that in 2024 and 2025, the company's revenue will be 1157.5 billion yuan and 1232.6 billion yuan, respectively, and non-GAAP net profit will be 35.682 billion yuan and 43.368 billion yuan, respectively. Maintaining a “buy” rating, the target price was HK$123.89, corresponding to 10 times the Group's PE in 2024.