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Strong 3P growth and category expansion

■ JD reported 3Q21 revenue of Rmb218.7bn, up 25.5% yoy, in line with our expectation. Non-GAAP net profit was Rmb5.5bn, flattish vs. 3Q20, but better than we expected, mainly due to efficient control of expenses.
■ 3P marketplace revenue grew strongly by 35% yoy in 3Q21, and JD successfully expanded into new product categories, like FMCG, apparel and cosmetics.
■ JD adjusted Jinxi Pinpin’s strategy to focus 10 provinces/areas in 3Q21, and will continue to invest in Jinxi Pinpin in the following quarters to explore the great growth potential in lower-tier cities.
■ Reiterate Add, with a higher DCF-based TP of HK$423 due to better expenses control.

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