JD's performance for 4Q23 is projected to be neutral, closely tied to the ongoing recovery of China's economy. Here are the key takeaways:
Low Base in 2023 Sets Stage for 2024 Growth:
Despite unexpected slow growth in China's economy in 2023, a low comparison base has been established for 2024, providing an opportunity for improved growth.
JD, a domestic-focused business, is poised to benefit from China's gradual economic recovery.
Lack of New Internal Growth Drivers:
While 2024 is expected to bring better economic growth, JD may face pressure due to its domestic focus, potentially missing out on growth opportunities outside of China.
Performance Projection:
JD's total net revenue for 4Q23E is estimated to grow by 2.7% YoY, reaching RMB 303.3B, slightly exceeding consensus estimates at RMB 301.4B (2.0% YoY).
Product revenue is expected to reach RMB 239.3B (0.7% YoY), showing improvement from a decline of 0.9% YoY in 3Q23.
Service revenue is projected to increase by 10.6% YoY to RMB 64.0B in 4Q23E.
Data Highlights:
Gross Merchandise Volume (GMV) is anticipated to reach RMB 1,280B in 4Q23E, marking a 9.6% YoY increase.
GMV growth for online direct sales is expected to be 7.8% YoY in 4Q23E.
GMV of the marketplace is projected to grow by 11.4% YoY in 4Q23E, surpassing the growth of its 1P business.
GMV Growth Details:
Mobile Handsets & Other Digital Products are expected to increase by 1.2% in December 2023 and 3.5% YoY in 4Q23.
Home Appliances are projected to grow by 4.7% YoY in December and 5.5% YoY in 4Q23.
Marketplace Growth:
Apparel is forecasted to grow at 17.8% YoY in December 2023 and 17.7% YoY in 4Q23.
Shoes, Bags, Jewelry, Luxury Goods, and Furniture & Household Goods are maintaining stable growth in 4Q23E.
JD's performance reflects its resilience in navigating economic challenges and adapting to the evolving market conditions.
