China's online retailers are getting primed for one of the biggest retail sales days of the year next month on November 11, according to Chinese language media reports.
Single's Day, or 11/11 for short, is a sales day in China that celebrates the country's estimated 300 million citizens who are not married or in a relationship. The reverse Valentine's Day event is traditionally a boon for retailers.
JD.com Inc (NASDAQ: JD) CEO Xin Lijun announced Thursday that this year, the platform will hold a "pre-sale" event for single's day that will kick off this weekend on October 23. He said that there were 1.5x more retailers participating on the platform than the year before, too.
JD.com expects to sell over 800 million items of which 500 million will be brand new products that are being newly-launched. Xin added that there would be twice the number of discounts available on sales as for the year before, which end officially on November 13.
Online retailer Bilibili Inc. (NASDAQ: BILI) is also ramping up its preparations for Single's Day sales this year, joining forces with JD and Alibaba this year to feed into the consumer frenzy. It plans to offer a unique Single's Day launchpad as well as a TMall portal to drive sales to Alibaba Group Holding's (NYSE: BABA) Chinese e-commerce platform.
Alibaba and JD.com are in a selling rout after suffering from a series of downgrades right now. China International Capital Corp Limited (OTC: CNICF) is one bank that thinks that the three-week sales period will rev up earnings for the retailers for the end of this year however.
In a research note Thursday, CICC said that online sales in China during September were 8% higher year-on-year at 1.28 trillion RMB ($174 billion), and 9% higher for the third quarter overall vs. the same period a year ago, coming in at 3.7 trillion RMB. CICC expects that trend to continue, citing rising volumes of online sales in the 10% range month-on-month in September vs. August, especially with respect to physical products which are now picking up.
That seems to align with comments by JD.com's Xin to the Chinese press that the platform's recent initiative of removing shipping costs had seen the company sell-out of products in record time.
CICC gave Alibaba a price target of HK$137, an increase of 70% over the current market price for the stock and has a price target for JD's US-listed shares of $44, a 60% increase over the current price. The merchant bank rates both stocks "outperform".