After Chinese e-commerce giants have announced their latest results, analysts at big banks have raised their target prices and expressed optimism.

Investment bank SusquehannaBased on$BABA (BABA.US) $It announced results for the first quarter of fiscal 2021 and raised its target price to $350 from $275, maintaining a "positive" rating. Susquehanna said BABA's performance was "strong across the board". The investment bank also pointed out that health incidents have transformed users' buying habits into online, which will further consolidate BABA's market position.

Goldman Sachs GroupPublished a research report, reiterating that$BABA-SW (09988.HK) $The "buy" investment rating (confirmed buy list) raised its target price for its Hong Kong shares by 14 per cent from HK $268 to HK $306 to reflect the growth of its mainland retail market and the valuation of its cloud business, as well as the rise in the valuation of Ant Technology. Goldman Sachs Group pointed out that BABA reported better-than-expected results in the first half of fiscal year 2021, with revenue rising 34 per cent year-on-year to 153.8 billion yuan, higher than Goldman Sachs Group and market expectations of 3 per cent and 4 per cent respectively.

BarclaysAnalyst Gregory Zhao will$JD.com (JD.US) $The target price was raised to $83 from $79, and the "overweight" rating was maintained. Gregory Zhao said user engagement, merchant marketing demand and supply chain and logistics capabilities in China reached record highs in June, as evidenced by the financial statements submitted by BABA, JD.com and Pinduoduo last week. The analyst believes that this has set a "new starting point" for China's e-commerce market.

NomuraUp-regulation$JD.com Group-SW (09618.HK) $The target price will be raised from HK $287 to HK $320, the rating will be maintained as a "buy", and the company's revenue forecasts for this year and next will be raised by 3% and 6% respectively to reflect the positive increase in revenue in the company's main business sectors. As the company's second-quarter earnings exceeded expectations, it also raised its earnings per share forecast for this year by 11%.

Although UBS lowered Pinduoduo's ADR to a neutral target price of $95,Anjie SecuritiesThe target price will be raised to $110.0, Anjie Securities believes.$Pinduoduo (PDD.US) $It achieved 345.7 billion yuan in GMV per quarter, + 47.6% compared with the same period last year, which is lower than the year-on-year growth rate of 81% in the past 19 years. The main reason is that the company has adopted a more aggressive subsidy policy since the same period last year, resulting in a higher base for the same period last year. The Non-GAAP net profit of the company is-77.24 million yuan, which is significantly smaller than that of-410 million yuan in the same period last year, and much better than the expectations of Anjie Securities (- 1.01 billion yuan) and market expectations (- 1.38 billion yuan).

From the perspective of the industry as a whole:

CITICThe research report "Business & Technology | E-commerce 20Q2 performance Summary: increasing Speed and efficiency, adding leaders" was released today.

The revenue growth of 2020Q2's major e-commerce companies has exceeded the company's guidance, and the profit side has improved better than expected. The monthly data reflect the continuation of the prosperity of the e-commerce industry in July, and the seasonal growth rate of the Q3 industry is expected to decline more limited. Under low expectations, it is likely that the performance of major companies will exceed expectations again. We raise the annual growth forecast of the e-commerce industry, the growth track, big fish and water, plus faucets.

Specifically,

▍ epidemic accelerates consumption line, physical e-commerce growth accelerates

2020H1, the size of physical e-commerce is 4.35 trillion yuan, an increase of 14.3% over the same period last year. It is estimated that the growth rate of 2020Q2/ in June has reached 21.6%, 25.7%, and the monthly growth rate has rebounded to the highest level in the past two years, exceeding expectations. Mainly due to:

1) the online consumption caused by the epidemic did not fade quickly, and the consumption habits that became continuous after the resumption of work and production were retained, such as fresh-to-home consumption (social zero online "eating" goods increased by 38.8% in half a year compared with the same period last year)

2) the consumption of low-line e-commerce is developing in depth, and the dividend of users is spillover. The epidemic quickly promoted low-line users' consumption of e-commerce from "contact-familiarity-dependence". In addition to integrated e-commerce, Taobao special edition and Jingxi, which mainly focus on low linear price-to-price consumption, started rapidly.

▍ Q3 is not weak in the off-season, Q4 may speed up again in the peak season.

It is estimated that the growth rate of physical e-commerce in July is about 24.2% (VS in June is 25.7%), and the growth rate of express volume above scale is 32.2% (VS in June is 41.1%). The consumption of low-priced goods (the overall unit price of e-commerce fell 3 yuan to 125 yuan month-on-month in the non-promotion season in July compared with June) partly smoothed the seasonal fluctuations of brand e-commerce. Coupled with the extension of Singles Day promotion, the growth rate of the industry in the second half of the year is worth looking forward to. The growth rate of physical e-commerce for the whole year of 2020 is expected to be 20.3%, and the scale of physical e-commerce is expected to reach 18.6 trillion in 2024 in five years.

▍The "limited dispersion" pattern continues, and the share of Top3 continues to increase.

In the single quarter of 2020Q2, Tmall physical objects / JD.com (only self-employed) / Pinduoduo grew at a year-on-year growth rate of 27%, 33.5% and 47.6%, all leading the market. Pinduoduo & JD.com single-quarter AAC net increase 5510 / 30 million (VS BABA 16 million), continue to draw the gap with BABA, and BABA is still in the lead in terms of customer cost (per capita marketing expenses: BABA 67.3yuan VS JD.com 57.2yuan VS Pinduoduo 46.3yuan). The share of Top3 platform has increased steadily, and the relative pattern change depends on the consolidation and extension of the minds of users of their respective platforms.

▍Q3 has the possibility of exceeding expectations under low expectations.

The performance of 2020Q2's major e-commerce companies improved significantly month-on-month, with the revenue side exceeding the company guidelines (JD.com / Vipshop Holdings Limited / Baozun) and the profit side improving better than expected (the market generally expects Q2 to decline to a certain extent due to increased sales promotion). Under the expectation of the full release of Q2 consumer demand and the seasonal decline in the Q3 industry, the Bloomberg market consensus on Q3 income growth / profit margins of major companies has fallen to a certain extent. Considering the high growth of the actual data of the Bureau of Statistics in July, the seasonal growth rate of the Q3 industry is expected to decline more limited. Under low expectations, it is likely that the performance of major companies will generally exceed expectations again.

To maintain the early judgment, Q2 performance exceeded expectations and the industry boom continued in the second half of the year, the industry attack opportunity will come again. From an extended point of view, CITIC believes that China's e-commerce has both efficiency and scale advantages, and has full confidence in the long-term growth and penetration of China's e-commerce and the climbing profit margins of leading companies. Under the limited scattered pattern, the user dividend spillover will promote the vertical track with category killer characteristics to still have the opportunity to grow.

Combined with Q2 performance and Q3 outlook, CITIC proposes to overmatch the three leaders BABA, JD.com Group and Pinduoduo. Taking into account the quarterly improvement trend and valuation matching, focus on Baozun Inc and Vipshop Holdings Limited.

So on the whole, analysts are not only satisfied with the results that Chinese e-commerce has released, but are also optimistic about their future development.

The market is responsive, and the shares of e-commerce giants have emerged from a gratifying rise. The US stocks of the three giants closed up 3.62%, 3.66% and 4.91% respectively on Tuesday, and BABA and JD.com set record highs. The shares of BABA and JD.com also rose after the opening of Hong Kong stocks on Wednesday.