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MarketScreener Homepage  >  Equities  >  Nasdaq  >  JD.com, Inc.    JD


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JD Health IPO Adds to Hale and Hearty Hong Kong Market

11/25/2020 | 05:15am EST

By Joanne Chiu and Quentin Webb

Hong Kong is having a standout year for stock listings, despite political turmoil and the derailment of the world's largest initial public offering.

On Wednesday, the telemedicine arm of Chinese e-commerce giant JD.com Inc. kicked off a $3 billion-plus IPO in Hong Kong. The deal by JD Health International Inc. will help lift proceeds from Hong Kong IPOs and secondary listings to a 10-year high, even after the sudden suspension of Ant Group Co.'s blockbuster listing earlier this month.

The city's capital markets continue to draw funds from global investors despite strained relations between Beijing and Washington, China's imposition of a new national-security law in Hong Kong in June, and other complications such as the Trump administration's attempt to bar American investors from holding stocks of some Chinese companies.

Hong Kong is the preferred listing venue for many Chinese companies, including technology and health-care startups, and has seen dozens of IPOs from China this year. It has also hosted several secondary listings by U.S.-traded Chinese companies.

Beijing-based JD Health on Wednesday began taking orders for a $3.1 billion to $3.5 billion IPO, according to a term sheet seen by The Wall Street Journal. With Ant's listing delayed, this would be Hong Kong's largest IPO this year, according to Refinitiv.

Property-management companies backed by developers China Evergrande Group and China Resources Land Ltd. are separately seeking to raise a combined total of as much as $3.6 billion, ahead of market debuts in early December, filings showed.

The planned listings are set to push fundraisings from IPOs and secondary listings in Hong Kong above last year's total to the highest since 2010, when such share sales like this raised more than $57 billion, according to Refinitiv. More than 110 companies have already raised $39.1 billion through new listings this year.

The flurry of share sales is good news for major U.S. banks, which have secured senior roles on many of the deals. It is also a boon for the Hong Kong stock exchange, after it revamped its rules in recent years to accommodate unprofitable companies and those with unconventional shareholding structures. Shares of the city's exchange operator briefly hit a record intraday Wednesday, but later fell back.

For companies seeking to raise capital from international investors, "Hong Kong is still a very attractive place," said Frank Tsui, senior fund manager at Value Partners, an independent asset-management firm based in the city. "I'm not seeing a slowdown in the IPO pipeline."

Mr. Tsui said Hong Kong had been buoyed by the exchange's reforms as well as the "massive global liquidity" supplied to markets by the Federal Reserve and other central banks. Hong Kong was likely to remain a competitive financial center in the medium term, he said, at least until China's onshore stock markets were fully open to foreign investors.

The pandemic has increased investors' interest in certain health-care businesses, and fundraising by Chinese health-care companies has hit records this year.

JD Health said it runs China's largest online pharmacy by revenue, organizes medical bookings and offers online consultations with doctors.

It made a net loss of 5.4 billion yuan, the equivalent of $819 million, in the six months to June, as expenses rose and it booked a charge for the change in the fair value of convertible preferred shares. Revenue rose 76% year over year to 8.8 billion yuan, most of which came from sales of products like over-the-counter medicines, prescription drugs, contact lenses and medical devices.

JD Health is offering nearly 382 million shares, with an indicative price range of 62.80 Hong Kong dollars to HK$70.58 each--the equivalent of $8.10 to $9.10. That represents 12.2% of its enlarged share capital and will value the company at up to $28.5 billion.

Six cornerstone investors, including investment firms BlackRock, Tiger Global and Hillhouse, will buy up to $1.35 billion of stock wherever the deal is priced. The IPO could increase to $4 billion if underwriting banks exercise an option to buy 15% more shares.

JD Health plans to fix the offer price on Dec. 1 and list on Dec. 8. The deal is being led by units of Bank of America Corp., Haitong International Securities Group Ltd. and UBS Group AG.

Write to Joanne Chiu at joanne.chiu@wsj.com and Quentin Webb at quentin.webb@wsj.com

(END) Dow Jones Newswires

11-25-20 0514ET

Stocks mentioned in the article
ChangeLast1st jan.
BANK OF AMERICA CORPORATION -2.88% 33.01 Delayed Quote.12.14%
BLACKROCK, INC. -2.12% 727.76 Delayed Quote.0.86%
CHINA EVERGRANDE GROUP -0.83% 14.36 End-of-day quote.-3.62%
CHINA RESOURCES LAND LIMITED 0.48% 31.2 End-of-day quote.-2.50%
JD.COM, INC. -1.65% 87.77 Delayed Quote.-0.15%
UBS GROUP AG -0.44% 13.465 Delayed Quote.7.98%
VALUE PARTNERS GROUP LIMITED -1.75% 5.06 End-of-day quote.23.72%
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Sales 2020 740 B 114 B 114 B
Net income 2020 25 309 M 3 906 M 3 906 M
Net cash 2020 89 116 M 13 752 M 13 752 M
P/E ratio 2020 34,0x
Yield 2020 -
Capitalization 881 B 136 B 136 B
EV / Sales 2020 1,07x
EV / Sales 2021 0,85x
Nbr of Employees 284 000
Free-Float 84,0%
Chart JD.COM, INC.
Duration : Period :
JD.com, Inc. Technical Analysis Chart | MarketScreener
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Technical analysis trends JD.COM, INC.
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus BUY
Number of Analysts 39
Average target price 663,76 CNY
Last Close Price 568,75 CNY
Spread / Highest target 42,3%
Spread / Average Target 16,7%
Spread / Lowest Target -16,3%
EPS Revisions
Managers and Directors
Qiang Dong Liu Chairman & Chief Executive Officer
Nan Li Director-Strategy & Operations
Ran Xu Chief Financial Officer, Senior VP & CFO-JD Retail
Chi Ping Lau Director
Ming Huang Independent Director
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