JD HEALTH(06618) 天风证券·2024-08-21 00:40Investment Rating - The investment rating for JD Health (06618.HK) is "Buy" with a target price set at HKD 22.05, maintaining the rating [6]. Core Insights - JD Health reported a revenue of CNY 28.344 billion for the first half of 2024, representing a year-on-year growth of 4.6% compared to CNY 27.1 billion in the same period last year [1]. - The company's self-operated product revenue reached CNY 23.91 billion, growing by 3.2% year-on-year, while service revenue increased by 12.5% to CNY 4.43 billion [1][2]. - The gross profit margin improved by 0.7 percentage points to 23.6%, with a net profit of CNY 2.03 billion, marking a 30.2% increase year-on-year [1][2]. - The number of active users reached 181 million, with a net increase of 12 million users compared to the previous year [1][2]. Summary by Sections Financial Performance - For the first half of 2024, JD Health achieved a gross profit of CNY 6.7 billion, an increase of 8% year-on-year, with a net profit margin of 9.3% [2]. - The adjusted Non-IFRS net profit was CNY 2.64 billion, up 8.5% from CNY 2.44 billion in the same period last year [1][2]. Business Model and Growth Drivers - The company has established a mature operational model integrating self-operated, online platform, and instant retail services, which is expected to enhance user penetration and purchase frequency [2][3]. - The platform, advertising, and other services contributed CNY 4.43 billion in revenue, reflecting a 12.5% year-on-year growth, with over 80,000 third-party merchants onboard [2]. Market Expansion - JD Health has initiated online medical insurance drug purchasing services in multiple cities, which is anticipated to drive new traffic growth for the platform [3]. - The instant retail service "JD Buy Medicine" achieved an average delivery time of 28 minutes, covering over 490 cities and partnering with more than 150,000 pharmacies [3].