Dada Group Partners Up With More Than 20 Supermarket Chains
Dada Group’s online retail platform JD Daojia (JDDJ) has signed partnership deals with more than 20 regional supermarket chains in China in a bid to expand its presence into lower-tiered markets. JDDJ has also strengthened existing partnerships with other leading retailers, including Walmart.
JDDJ is one of China’s largest local on-demand retail platforms for retailers and brand owners. As a result of the new partnerships, Dada (DADA) now collaborates with 66% of the 100 largest supermarket chains in China.
Huijian He, Dada’s Vice President, said, “The lower-tier market has become a major growth driver and an important part of our development strategy for JDDJ,” adding that the company intends to continue expanding in order to bring one-hour delivery services to more lower-tier cities. (See DADA stock analysis on TipRanks)
KeyBanc analyst Hans Chung initiated a Buy rating on DADA last week, setting a price target of $55. This implies upside potential of around 32% from current levels.
Chung believes that Dada’s unique business model, strong supply chain and proprietary technology solutions differentiate it from its competitors and create barriers of entry. The analyst added that the RMB 10 trillion grocery retail market is “big enough for multiple players”.
Consensus among analysts is a Strong Buy based on 4 Buys and 1 Hold. The average price target of $43 suggests upside potential of around 3% over the next 12 months.
DADA scores a 9 out of 10 on Tipranks’ Smart Score rating indicating that it has a strong chance of beating market expectations.
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