Daily Brief China: Xiaomi Corp, JD Health, First Pacific Co and more

• Several news media outlets reported that Xiaomi Corp (1810 HK) has started laying off about 10-15% of its employees across several units of its smartphone and internet services businesses.
• Xiaomi’s margins have come under pressure with entering into the premium smartphones segment which has resulted in aggressive expansion of offline stores.
• The company’s 3Q2022 revenues declined 9.7% YoY as a result of decrease in revenue from all three business segments while margins further dropped compared to 3Q2021.

• JD Health (6618 HK) is on the right track in terms of business model and investment logic. The Company has also begun to enter a virtuous circle in financial performance.
• There were some positive business updates in term of To B business in 22Q1-Q3, which would bring JD Health closer to establishing a complete “retail pharmacy + healthcare service” ecosystem.
• For trading strategy, at present, considering the complex external environment, we recommend investors to do short-term trade, rather than long-term hold.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• First Pacific Co