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<Research>CLSA: JD-SW's Acquisition of Ceconomy Will Heighten Investment Expenditure
Recommend 9 Positive 13 Negative 10 |
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JD-SW (09618.HK) (JD.US) is reportedly in in-depth negotiations to acquire Ceconomy AG, a German electronics retailer, for around EUR2.2 billion (equivalent to USD2.6 billion), and Ceconomy has already confirmed this in its statement, according to CLSA's research report. In the broker's opinion, JD-SW differs from its peers with its advantage in a self-operated model and continuous exploration of overseas physical retail M&As. The company had previously negotiated to acquire the UK electronics retailer Currys. While JD-SW held net cash of RMB165 billion (equivalent to USD23 billion) as of 1Q25, CLSA stressed that operating and expanding physical stores is challenging, especially in Europe, and Ceconomy's revenue growth is moderate. The report also mentioned that JD-SW's food delivery business in China incurred a loss of RMB10 billion in 2Q25, and international expansion might lead to more investment expenditure. CLSA gave JD.com's US shares an Outperform rating with a target price of USD41. AAStocks Financial News |
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