Nomura Expects JD Logistics' 1Q26F Results to Beat Expectations, Maintains Buy Rating

Overview

Nomura released a 1Q26F earnings preview for JD Logistics 2618.HK and believes the company may report first-quarter results that are better than expected. The report expects revenue growth, margin improvement, and adjusted net profit growth to all outperform market consensus, while maintaining FY26/27F forecasts, a Buy rating, and a HKD18 target price.

Core views

The core view is that JD Logistics' 1Q26F growth quality is solid: internal integrated supply chain revenue is expected to grow 6%, external integrated supply chain revenue growth is expected to accelerate from 3% in 4Q25 to 9% in 1Q26F, and organic revenue growth from other customers is expected to rebound from 1% to about 3%. On the profit side, higher utilization of earlier heavy investment in labor and transportation resources, together with easing competition in the express delivery industry and improved average selling prices, are expected to drive adjusted net margin higher year over year.

Analysis framework

The report uses an earnings preview and consensus comparison approach, breaking down revenue growth, organic growth by business segment, margin changes, and valuation multiples. On valuation, Nomura uses 11x FY26F P/E as the primary valuation method to derive the HKD18 target price, and uses the Hang Seng Index as the stock's benchmark index.

Methodology notes

• Valuation MethodP/E valuation

  11x FY26F P/E

  Nomura uses P/E as the primary valuation method and derives the HKD18 target price based on 11x FY26F P/E.

• Earnings PreviewConsensus comparison

  Deviations of revenue and net profit versus Bloomberg consensus

  The report compares its 1Q26F revenue forecast with Bloomberg consensus and believes revenue is 2% above consensus; adjusted net profit is 11% above the latest consensus.

• Operating BreakdownSegment growth analysis

  Internal ISC, external ISC, express and freight, organic growth

  The report explains the sources of revenue growth through internal integrated supply chain, external integrated supply chain, and revenue from other customers.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• JD Logistics 2618.HK

  Covered company

  Strengths

  A leading integrated supply chain logistics service provider in China, with revenue growth expected to exceed market expectations and margins benefiting from improved utilization and easing express delivery competition.

  Weaknesses

  Deppon may see year-over-year revenue declines due to a high base in the same period last year; rising fuel costs may create greater pressure in 2Q26F.

  Comparison

  The HKD18 target price is based on 11x FY26F P/E, while the report says the company currently trades at 8.6x FY26F P/E; the benchmark index is the Hang Seng Index.

  Risks

  Intensifying competition, slower-than-expected customer acquisition, regulatory risks, and rising fuel costs.

• 09618.HK

  Related listed entity

  Strengths

  The report mentions JD Retail sales as the comparison base for internal ISC revenue growth.

  Weaknesses

  JD Retail is more affected by a high base from trade-in subsidies.

  Comparison

  JD Logistics' internal ISC revenue growth may outpace JD Retail sales.

  Risks

  Not the primary covered company in this report, so related information is limited.

Key data

• 1Q26F total revenue forecastCNY58.8bnUp 25% year over year, 2% above Bloomberg consensus.
• 1Q26F organic revenue growth5%Growth excluding the consolidation impact from instant retail delivery services.
• Internal ISC revenue growth6%Expected to grow faster than JD Retail sales and less affected by a high base from trade-in subsidies.
• External ISC revenue growth9%Accelerating from 3% in 4Q25, mainly driven by customer base expansion.
• Other customers' organic revenue growthabout 3%Supported by double-digit resilient growth in the bulky-item business and nearly 10% growth in the express delivery business.
• 1Q26F adjusted net margin1.8%Up 0.2 percentage points year over year.
• 1Q26F adjusted net profitCNY1bnAdjusted net profit before non-controlling interests is expected to grow 38% year over year, 11% above consensus.
• Target priceHKD18Based on 11x FY26F P/E, implying 25% upside.
• Current valuation8.6x FY26F P/EThe report says JD Logistics currently trades at 8.6x FY26F P/E.

Impact & implications

If 1Q26F results are delivered as expected, JD Logistics could strengthen market confidence in its growth recovery and operating leverage release through revenue beats and margin improvement. Maintaining a Buy rating and 25% upside suggests Nomura believes the current valuation does not fully reflect the improvement in earnings. Investors should watch fuel costs, industry competition, and customer acquisition speed for their impact on subsequent quarters.

Risks

• Intensifying competition from existing companies and new entrants.
• Slower-than-expected customer acquisition.
• Regulatory risks.
• If tensions in the Middle East persist, the impact of rising fuel costs on 2Q26F profitability could increase.
• Deppon faces revenue pressure from a high base in the same period last year.

What to watch

• Whether 1Q26F revenue reaches CNY58.8bn and exceeds consensus.
• Whether adjusted net margin reaches 1.8% and adjusted net profit is close to CNY1bn.
• Whether external ISC customer expansion continues and revenue growth remains around 9%.
• Whether express delivery growth and industry average selling prices continue to improve.
• Whether fuel cost pressure can be alleviated through new-energy vehicles, dispatch optimization, and cost pass-through to some ISC customers.
• Whether FY26/27F earnings forecasts and the 11x FY26F P/E valuation assumption need to be adjusted.