We expect JD’s credit profile to be stable over the next 6-12 months. We expect JD’s topline growth to be supported by continued recovery in China’s e-commerce sector over the coming quarters.

We expect JD to continue to protect its (albeit still thin) margins with cost control measures and enhanced operating efficiency.

We expect China’s consumer spending on discretionary items to gradually improve as COVID restrictions ease, though they may not fully recover until the country completely exits from the zero-COVID policy (likely in 2H23, according to our China macro team).

Chinese tech companies have been facing increasing scrutiny by the Chinese government. Any regulatory clampdowns may adversely affect the business of JD (e.g. antitrust rules, data security & personal data protection laws).

A prolonged economic slowdown in China would weigh on consumption and JD’s business outlook.

There are regulatory risks involving the use of variable interest entities (VIEs) to circumvent China’s restrictions on foreign ownership of Internet Content Providers (ICPs). Specifically, VIE transactions involving “change in control” will be subject to antitrust regulatory processes.

JD may be subject to lawsuits for items listed on its marketplaces, which may be pirated, counterfeit or illegal. JD cooperates with 3rd party logistics cos to help deliver products to buyers. Failure to provide reliable delivery services may materially affect the business.