Innovative drugs + AI, is JD Health's growth narrative being reshaped?

Beyond traditional e-commerce, JD Health is attempting to reshape its growth narrative with two new engines: innovative drugs and AI. According to news from the Chasing Wind Trading Platform, HSBC's research report on October 13 shows that JD Health's fundamentals are strongly supported by two core businesses: pharmaceuticals and health supplements. The report predicts that under this dual drive, the company's revenue in the second half of 2025 will achieve approximately 20% year-on-year growth. Among them, the innovative drug business is seen as a "highlight." According to the report, innovative drugs currently account for about 30% of JD Health's total sales of prescription drugs, and its growth rate is expected to continue to rise, mainly benefiting from the online traffic migration brought about by the outflow of hospital prescriptions. At the same time, the growth of the health supplement business is also expected to benefit from the increase in users and traffic. AI Empowerment Shows Initial Results, Conversion Rate Increases by 10 Percentage Points In this report, AI is no longer just a concept but has transformed into concrete operational benefits. JD Health revealed in an investor meeting that the application of AI technology has helped the company improve cost efficiency and conversion rates by 10 percentage points. The company can utilize its vast amount of real user dialogue data on its platform to train its AI models, making them more accurate and efficient. In the future, JD Health will continue to invest in AI, but the report believes that its scale will be "controllable." Offline Expansion and Investment Weigh on Short-Term Profits Growth does not come without a cost. The report points out that JD Health is actively expanding offline, planning to open 200 self-operated pharmacies within the year. This investment is the main reason for the pressure on its profit margins. Data shows that JD Health achieved a 10% adjusted net profit margin in the first half of 2025, but the company expects this indicator to remain at 8-10% in the short term. The report predicts that the Non-IFRS net profit margin for the third quarter of 2025 will be around 8%, while it may drop to about 6% in the second half of 2025. However, the report also mentions that the company is implementing "stricter cost control," which should help buffer the profit margin. Based on the above analysis, the bank ultimately maintains a "buy" rating on JD Health and raises the target price from HKD 65.00 to HKD 66.00, believing that the company can effectively capture the growing online medical demand against the backdrop of medical reform. As of the report's publication date, this target price implies a 7.4% upside potential. The above content is from [Chasing Wind Trading Platform](https://mp.weixin.qq.com/s/uua05g5qk-N2J7h91pyqxQ). For more detailed interpretations, including real-time insights and frontline research, please join the【 [Chasing Wind Trading Platform ▪ Annual Membership](https://wallstreetcn.com/shop/item/1000309)】 [![](https://wpimg-wscn.awtmt.com/3c4a713c-7a38-4582-9850-d0eabaf0e7ad.png)](https://wallstreetcn.com/shop/item/1000309)