Capital Calls: JD plays it safe with logistics spinoff

Employees sort parcels at'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

HONG KONG, May 24 (Reuters Breakingviews) - Concise insights on global finance.


RANGE BOUND.’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 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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