China Merchants published research reports stating that jd.com (09618.HK) recorded a 5% year-on-year growth in revenue in the third quarter of this year, meeting expectations. Benefiting from trade-in promotions, revenue from household appliances category significantly rebounded compared to the previous quarter; gross profit increased by 16% year-on-year, with gross margin rising by 1.6 percentage points to 17.3% year-on-year, exceeding the market's expectations by 1.2 percentage points; non-GAAP operating profit increased by 18% year-on-year, surpassing the expected 19%; non-GAAP net profit increased by 24% year-on-year, exceeding the expected 16%; as for non-GAAP net profit margin, it rose by 0.8 percentage points to 5.1% year-on-year, steadily progressing towards the high single-digit long-term target set by the company management.

China Merchants Securities predicts that jd.com's group revenue will grow by 5.7% year-on-year in the fourth quarter of this year, with retail revenue of jd.com increasing by 6.1% year-on-year. The bank also forecasts that jd.com's retail income for the fiscal years 2024 and 2025 will grow by 5% and 5.6% respectively year-on-year; operating profit will increase by 0.6% and 4.7% respectively year-on-year. Regarding jd.com's group revenue for the fiscal years 2024 and 2025, it is expected to grow by 4.7% and 6% respectively year-on-year; non-GAAP net profit is forecasted to grow by 28% and 4% year-on-year respectively.

Furthermore, China Merchants Securities maintains its jd.com revenue forecast mostly unchanged and has revised its non-GAAP net profit forecast for the fiscal years 2024 to 2026 by 5% to 6%. The bank also estimates that jd.com's potential shareholder return will reach approximately 6.7%, similar to the return level of alibaba-W (09988.HK).

China Merchants Securities has raised jd.com H-share target price from 165 yuan to 179 yuan, maintaining a 'shareholding' rating. (js/u)

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