JD.Com Inc (ADR) (NASDAQ:JD) is ready to develop its Southeast Asia footprint, as China’s largest retailer announced an aggregate investment to the tune of up to $500 million, where the company seeks to set into motion two joint ventures in Thailand covering e-commerce and fintech services, respectively.
Under the terms of the agreement, half of the investment will come from Central Group, with the remainder coming from JD.com, JD Finance and Provident Capital, which is also JD.com’s strategic partner for its Indonesian e-commerce business.
JD.com will provide its extensive expertise in technology, e-commerce and logistics to the e-commerce joint venture. Meanwhile, the fintech services joint venture will benefit from JD Finance’s deep knowledge in the financial technology sector, including its experience building out easy-to-use fintech services in developing markets using its artificial intelligence, cloud computing and other industry-leading technology capabilities. Across both businesses, Central Group will leverage its immense retail resources, including its physical store network, which will serve as key omni-channel and payment locations, its wealth of brand and merchant relationships, as well as its retail behavior insights from its hugely popular customer loyalty program, “The 1 Card.” To strengthen the product offering, and to accelerate its own omni-channel growth, Central Group will open multiple flagship stores on the e-commerce platform for its department stores and key retail chains, as well as for select brands owned or operated by Central Group.
“Thailand’s large population and developed infrastructure, including strong national logistics networks, give it tremendous potential for both e-commerce and fintech services,” said Richard Liu, JD.com’s Chairman and CEO. “Working with Thailand’s strongest retail conglomerate, with a massive shopping mall and department store network, gives us a huge competitive advantage as we expand further into Southeast Asia.”
“JD’s proven track record of successfully building out national online retail businesses made it the obvious choice to be our e-commerce partner,” said Tos Chirathivat, Chief Executive Officer of Central Group. “Thailand’s mobile-driven population, with its increasing consumer spending power, means that e-commerce is ready to explode, and this partnership is poised to capture the country’s consumers as they migrate online. This move marks a key step in Central Group’s goal to become Thailand’s online retail leader.” (Original Source)
Shares of JD.com Inc closed yesterday at $45.25, down $0.02 or -0.04%. JD has a 1-year high of $48.99 and a 1-year low of $23.38. The stock’s 50-day moving average is $43.55 and its 200-day moving average is $38.50.
On the ratings front, JD.com has been the subject of a number of recent research reports. In a report issued on August 23, MKM Partners analyst Rob Sanderson upgraded JD to Buy, with a price target of $51, which implies an upside of 13% from current levels. Separately, on August 22, Jefferies Co.’s Karen Chan reiterated a Buy rating on the stock and has a price target of $45.50.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Rob Sanderson and Karen Chan have a yearly average return of 13.2% and 25.3% respectively. Sanderson has a success rate of 66% and is ranked #303 out of 4642 analysts, while Chan has a success rate of 72% and is ranked #230.
Sentiment on the street is mostly bullish on JD stock. Out of 5 analysts who cover the stock, 4 suggest a Buy rating and one recommends to Hold the stock. The 12-month average price target assigned to the stock is $48.1, which implies an upside of 6% from current levels.
JD.com, Inc. engages in the sale of electronics products and general merchandise products, including audio, video products. and books. It also offers online sales of home appliances, digital communications, computers, home merchandise, apparel, baby book, food, and others.