Author Topic: JD - JD.COM  (Read 47073 times)

tol1

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Re: JD - JD.COM
« Reply #10 on: February 08, 2018, 02:51:31 AM »
Would be keen to hear about key metrics /drivers and how the current high NTM valuation can be justified accordingly.


one-foot-hurdles

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Re: JD - JD.COM
« Reply #11 on: June 01, 2018, 03:54:41 PM »
Notes from HK Sohn conference:
Quote
Kok Hoi Wong (APS Asset Management):  Short: JD.com (JD).  This has been a consensus long among many managers but argues that it's already priced for perfection.  Thinks impairment losses coming.  Company made bad investments (PaiPai and QQ Wanggou, Bitauto, Tuniu, Yihaodian).  Thinks a big impairment is possible from Yihaodian.  Management is "investing recklessly."  Says to be weary as company can't make a profit in highly competitive Chinese e-commerce market.  Business model is misunderstood.

Also see attachment for more detailed analysis

From what I know these guys have been short since 2016(since $25)
« Last Edit: June 01, 2018, 08:22:37 PM by one-foot-hurdles »

Spekulatius

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Re: JD - JD.COM
« Reply #12 on: June 02, 2018, 06:13:23 AM »
Gross margins have been increasing from 8.4% in 2012 to >14% in 2018, if you include the higher margin service revenues. The man bull thesis is that JD creates a better customer experience because they own their logistics network. I have not seen nothing in the this short thesis to refute this.

The thesis makes some points that are fair, but th same could have been made about AMZN, which started out as a book retailer and does not resemble anything to what it is right now.

it is a question of management being able to adapt and invest smartly and creating a better customer experience. if JD can do they, they should be able to succeed and it should pay out handsomely, if no t this will fail.

I have a small position in JD, which I regard as an option play of sorts and as that, I think it is pr9bably undervalued right now.
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Liberty

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Re: JD - JD.COM
« Reply #13 on: June 02, 2018, 11:13:42 AM »
ShawSpring Partners presentation from august 2016 (attached).
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lucasnascimento

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Re: JD - JD.COM
« Reply #14 on: June 06, 2018, 10:27:33 PM »
Attached a document I made compiling responses to APS' short thesis made by Richard from https://oraclefromomaha.wordpress.com and Lester from https://wondurrrrboy.wordpress.com/. Also attached APS' reports.

atbed

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Re: JD - JD.COM
« Reply #15 on: June 07, 2018, 12:35:05 AM »
I'm currently spending some time in China, and have spent the last few weeks in Shanghai/Beijing. Naturally, I've been hearing a ton on JD and BABA. Here's an interesting POV: Both sites have fakes, because they are extremely difficult to get rid of. People expect this. JD talks a lot about getting rid of fakes, but some actually believe they talk the talk more than they can walk the walk. In comparison, Taobao is very open about the existence of fakes on their platform. The view is that Taobao will do what it can, but that consumers need to be careful. I'm also hearing that Taobao's customer service is better. In fact, I've heard horror stories about JD bullying their customers. Now none of this information was gathered through a formal survey, so take it with a large grain of salt.

Liberty

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Re: JD - JD.COM
« Reply #16 on: June 07, 2018, 07:13:36 AM »
Attached a document I made compiling responses to APS' short thesis made by Richard from https://oraclefromomaha.wordpress.com and Lester from https://wondurrrrboy.wordpress.com/. Also attached APS' reports.

Thank you, lucasnascimento, I appreciate it.
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oddballstocks

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Re: JD - JD.COM
« Reply #17 on: June 07, 2018, 07:58:02 AM »
Interesting thread, the short rebuttal was a good read.  Both sides seem to have good points.

I haven't followed this name closely, I know it's a hedge fund hotel, but a short based on valuation seems a little shaky here.

China is an interesting market.  Before the 08 crash there was a LOT of China hype too, no one could go wrong buying Chinese equities.  It's a strangely fascinating thing, I get that it has 1b+ people and is undeveloped.  But so is India, and India gets zero investment attention.  I understand that non-Indians can't buy Indian equities, but China is the same.  You're buying into a VIE that has a contractual relationship with the underlying entity.  Why can't they do this in India?


Do longs look at this as a buy and hold forever deal? Or is it more of a growth isn't being valued, so you buy until it's valued?
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Jurgis

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Re: JD - JD.COM
« Reply #18 on: June 07, 2018, 08:20:38 AM »
China is an interesting market.  Before the 08 crash there was a LOT of China hype too, no one could go wrong buying Chinese equities.  It's a strangely fascinating thing, I get that it has 1b+ people and is undeveloped.  But so is India, and India gets zero investment attention.  I understand that non-Indians can't buy Indian equities, but China is the same.  You're buying into a VIE that has a contractual relationship with the underlying entity.  Why can't they do this in India?

Maybe it's a good business to start. Indian VIEs. Assuming Indian government would not put their foot on it. Though maybe it's been done or been tried.

There are clearly other reasons of India vs China attractiveness that may or may not make sense.

Quote
Do longs look at this as a buy and hold forever deal? Or is it more of a growth isn't being valued, so you buy until it's valued?

I don't own JD. I'd say something like Tencent is hold forever, though possibly way too late after 400x bagger return. I've owned Chinese gaming companies and they seemed to be more "buy cheap, sell when not", since long term returns and business trajectories have been not great. There are exceptions maybe.
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Foreign Tuffett

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Re: JD - JD.COM
« Reply #19 on: June 07, 2018, 04:49:51 PM »
Interesting thread, the short rebuttal was a good read.  Both sides seem to have good points.

I haven't followed this name closely, I know it's a hedge fund hotel, but a short based on valuation seems a little shaky here.

China is an interesting market.  Before the 08 crash there was a LOT of China hype too, no one could go wrong buying Chinese equities.  It's a strangely fascinating thing, I get that it has 1b+ people and is undeveloped.  But so is India, and India gets zero investment attention.  I understand that non-Indians can't buy Indian equities, but China is the same.  You're buying into a VIE that has a contractual relationship with the underlying entity.  Why can't they do this in India?


Do longs look at this as a buy and hold forever deal? Or is it more of a growth isn't being valued, so you buy until it's valued?

It amazes me how readily investors in Chinese companies via this structure disregard the risk of waking up one day to find that they now own nothing more than a tiny interest in a Cayman Islands PO box. Or, less flippantly, the principal-agent problem already looms large in investing, why invest in a situation in which the "agents" (management and the Chinese communist party) are completely beyond the reach of the "principals" (foreign investors)?