JD.com shares hit record low, banks cut Q3 growth target on retail slowdown (updated)
13/10/2023 11:51
(Adds U.S.-listed shares in paragraph 5)
BEIJING, Oct 13 (Reuters) - Shares in Chinese e-commerce
giant JD.com 9618.HK fell as much as 13% to a record low on
Friday after several banks and brokers cut price targets and
revenue growth forecasts for the firm, citing a
weaker-than-expected recovery in consumer spending.
The brokerages and banks including Citi, Daiwa and
Jefferies, which issued notes to clients on Thursday and Friday
with the revised estimates.
JD.com, which is listed in Hong Kong and the United States,
is expected to report quarterly financial data in mid-November
following China's main online shopping festival, Singles' Day.
Shares in JD.com, which is also China's largest home
appliance retailer, closed at their lowest level since their
June 2020 debut.
U.S.-listed shares of JD JD.O fell 4.5% in premarket
trading and rival PDD Holdings PDD.O declined 1.9%.
A debt crisis in the key property sector has contributed to
slowing China's economic growth after the pandemic, while many
Chinese have cut back on spending due to concerns over the
economy and job security, hurting the retail sector.
In March, JD.com warned it would take time to rebuild
consumer confidence post-pandemic as it missed fourth-quarter
revenue forecasts.
Citi Research lowered its revenue assumption for JD.com by
3.4% and 4.3% for the third and fourth quarter, saying that it
now estimates 0.8% and 1.3% growth respectively.
The bank's analysts cited a "relatively muted consumption
trend, high base, intense competition, and on-going impact from
restructuring adjustment" for the change in estimates.
Nomura said JD.com had yet to see any meaningful improvement
in retail since the third quarter, adding that the company had
also missed on any positives from the stimulus policies China
has rolled out since September to rescue the property market.
JD.com said it had no comment on the analyst revisions and
its share price performance.
JD.com is China's leading online platform for sales of
digital and electronics products, such as mobile phones and
domestic electrical appliances.
Its rivals include Alibaba Group 9988.HK , which operates
the Taobao and Tmall marketplaces, as well as PDD Holding
PDD.O , which operates Pinduoduo. Both offer a wider range of
products at various prices.
In a separate statement published earlier on Friday, JD.com
said it had filed a police report over online rumours about an
arrested businessman that the perpetrators had maliciously
linked to the company.
(Reporting by Sophie Yu in BEIJING and Donny Kwok in HONG KONG;
editing by Brenda Goh and Miral Fahmy)
((Sophie.Yu@thomsonreuters.com; 861056692136;))