Hua Er Jie Jian Wen·2025-10-15 02:50Core Insights - JD Health is leveraging two main growth engines: innovative drugs and AI technology, aiming to reshape its growth narrative beyond traditional e-commerce [1] - The report from HSBC predicts a revenue growth of approximately 20% year-on-year in the second half of 2025, driven by the dual support of its core businesses [1] Innovative Drug Business - The innovative drug segment is highlighted as a key growth area, currently accounting for about 30% of JD Health's total prescription drug sales [1] - The growth rate of this segment is expected to continue increasing, primarily due to the shift of hospital prescriptions to online platforms [1] AI Technology Impact - AI technology has shown tangible results, improving cost efficiency and conversion rates by 10 percentage points [2] - The company utilizes vast amounts of real user dialogue data to train its AI models, enhancing their precision and efficiency [2] - Future investments in AI are planned to be "controllable" in scale [2] Offline Expansion and Profitability - JD Health is actively expanding offline, planning to open 200 self-operated pharmacies within the year, which is impacting short-term profit margins [3] - The adjusted net profit margin for the first half of 2025 is projected at 10%, but is expected to remain between 8-10% in the short term [3] - The report forecasts a Non-IFRS net profit margin of about 8% in Q3 2025, potentially dropping to around 6% in the second half of 2025 [3] - The company is implementing stricter cost control measures to buffer profit margins [3] Investment Rating - HSBC maintains a "buy" rating for JD Health, raising the target price from 65.00 HKD to 66.00 HKD, indicating a potential upside of 7.4% as of the report's publication date [3]