[Overseas Stocks Spotlight] "Jingdong, Focus on Investment Moves in the Distribution Market"

[Asia Economy Reporter Eunmo Koo] As JD.com (JD.US) is expanding its distribution ecosystem through active investment, there is an analysis that attention should be paid to the investment happiness in the distribution market.

Recently, e-commerce companies' stock prices have surged following the announcement of consumption promotion measures by China's Ministry of Commerce. On the 9th, Baek Seung-hye, a researcher at Hana Financial Investment, evaluated in a report that "the policy-based expectation of Lunar New Year consumption led to the stock price increase." This promotion measure is particularly a stimulus policy aimed at boosting consumption in rural areas, targeting the expansion of consumption in automobiles, home appliances, and dining out.

According to the announcement, to expand automobile consumption, subsidies are available when purchasing vehicles with carbon dioxide emissions lower than the national standard of grade 3, and rural residents who replace existing home appliances and furniture with green appliances and eco-friendly furniture can also receive subsidies. On January 5, when the consumption promotion policy was announced, JD.com, an e-commerce company, showed strong stock performance as it has differentiated competitiveness in logistics and electrical appliance categories.

JD.com is expected to expand its distribution ecosystem through investments in regional group buying and fresh food businesses. In December last year, JD.com invested $200 million in Xingsheng Youxuan, a regional group buying platform, and Xingsheng Youxuan's MAU net increase ranked first as of September last year. Researcher Baek predicted, "The group buying market is steadily growing mainly in small and medium-sized cities, so JD.com's expansion of investment in group buying platforms is expected to continue this year."

Additionally, to strengthen competitiveness in the fresh food sector, JD.com purchased a 5.37% stake in Dili Enterprise, which is engaged in agricultural product distribution, at the end of December last year. Researcher Baek evaluated, "Dili Enterprise currently operates large agricultural product retail markets, so synergy between the two companies is expected in fresh food procurement, storage, and distribution."

The third unicorn company of JD Group, JD Logistics, is expected to be listed on the Hong Kong Stock Exchange as early as the first half of this year. The estimated fundraising amount is $2 billion to $3 billion, and the raised funds are expected to be used for expanding logistics warehouses and establishing delivery systems.