This report is read as follows:
The fourth quarter results are in line with expectations, take the initiative to change strategic adjustment to compete for low-price mentality, short-term profit margins may fluctuate, but in line with the retail growth direction under the general trend of performance-to-price consumption.
Summary:
Strategic adjustment to take the initiative to change, do large-scale profit margins may fluctuate. It is estimated that the company's 23-25 adjusted net profit will be 222.5 million yuan, 2548 million yuan, 30.97 billion yuan, adjusted EBITDA of 292, 351 million, 41.3 billion yuan, and 2024 25xPE, with a target market capitalization of 637 billion yuan, corresponding to 717.8 billion Hong Kong dollars, with a target price of 230 Hong Kong dollars.
Performance description: the company's 22Q4 realized revenue of 295.446 billion (RMB, the same below) / + 7.1%, net profit of 3.032 billion, adjusted net profit of 7.659 billion / + 114.8%, and adjusted EBITDA of 8.898 billion / + 113.8%.
Revenue performance is in line with expectations, multi-factor impact retail growth continues to slow. The overall online downturn of ① 22Q4 has been expected, and revenue and adjusted results are in line with market expectations. Under the unfavorable factors such as limited performance, high return rate and sluggish consumer demand, it still achieved year-on-year growth, and the improvement of efficiency continued to drive the improvement of profit margins compared with the same period last year. However, compared with the continued bright logistics and 3P commission business, JD.com 's core retail 1P income growth is still slowing down. Although the impact of the epidemic is still the main reason for the slowdown, there is no doubt that the core 1P business is facing some problems, such as the slowdown of competitiveness, the growth bottleneck of the core customer base, the loss of performance-to-price ratio and so on.
Take the initiative to change and compete for low-price mentality, and the profit margin during the transition period may fluctuate. ① this season focuses on strategic change: 1) how does JD.com, who is actively seeking change, compete for low-price mentality; 2) impact on income and performance, does the industry repeat the price war? ② JD.com emphasizes low price / efficiency / experience, KPI changes from income and profit to GMV transaction scale, behind which is the competition for wallet share in the stock market; 1P and 3P positioning, flow distribution, supply chain logistics will be comprehensively adjusted; ② actively strives for better than rest on its laurels: JD.com 's core advantages are high-quality performance and deterministic experience. The performance advantage will diminish with the improvement of the performance efficiency of the whole society; under the environment of cost-effective consumption, JD.com, who is upgrading his route, faces a growth bottleneck and urgently needs to adjust his strategy to seek growth; but ③ retail is highly competitive. Compared with imitating competitors, JD.com needs to explore a suitable implementation model and path. The short-term mismatch of resource capacity and the high probability of the exploration process affect short-term profit margins. In the long run, the sustainability of incremental users after acquisition depends on whether a sustainable low-cost ecology can be established.
Risk hint: increased competition in the industry affects profit margins, and slowing economic growth affects consumer demand.