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Capital Calls: JD plays it safe with logistics spinoff


Employees sort parcels at JD.com’s automated logistics center during a government organized tour on China’s Singles Day shopping festival in Beijing, China November 11, 2020. REUTERS/Thomas Peter

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RANGE BOUND. JD.com’s (9618.HK) logistics unit is set to price its Hong Kong initial public offering towards the lower end of its stated range, Reuters reported read more , citing sources. The company will raise $3.16 billion in the city’s second-biggest float this year after selling shares for HK$40.36 ($5.20) each, compared to the offered range between HK$39.36 and HK$43.36. Bids were reported to have more than covered the shares on sale, suggesting strong demand that shouldn’t have required parent JD.com to leave $235 million on the table. What happened?

Granted, rival delivery giant SF Holding (002352.SZ) is down 25% this year. But the stock’s 7% gain last week means it is unlikely to have softened pricing. More likely is JD Logistics’ (2618.HK) first-quarter numbers released recently: a 64% year-on-year jump in sales was offset by a collapse in gross margins to 1%, from 9% in 2020. That served as a reminder the company is still an unpredictable read more , if fast-growing, earner. (By Jennifer Hughes)

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