Why is JD.com So Cheap?

China’s biggest retailer is on sale.

Andrew Willis 23 July, 2021 | 4:28AM
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Andrew Willis: As we move further into the digital era, we’re seeing more small stores promoted by targeted ads and online influencers – especially in China.

Some investors may see this rise of ‘interest e-commerce’ as a threat to large online retailers like JD.com or Alibaba, but concerns of diluted sales should be quelled when considering cost advantages still strongly held. Senior equity analyst Chelsey Tam says these one-stop e-commerce shops provide sales predictability to brands, which in turn optimizes their production costs.

Shoppers at JD.com must also enjoy the arrangement with revenue-per-user growing four-fold over the past five years. And with 100 million new customers expected this year at China’s largest retailer by revenue, it might be best to get ahead of the crowds.

For Morningstar, I’m Andrew Willis.


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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
JD.com Inc ADR29.32 USD-1.91Rating

About Author

Andrew Willis

Andrew Willis  is Senior Editor at Morningstar Canada. He previously produced content for Fidelity Investments and finance industry events for Euromoney Institutional Investor and has written in the past for Thomson Reuters and CNN. Follow him on Twitter @Andrew_M_Willis.

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