4 Top Chinese Tech Stocks For Your October Watchlist
If you have been following Chinese tech stocks in the stock market, you would’ve noticed that they have not been performing well so far this year. Now, this is mostly due to its government asserting even more control over its companies. That said, many financial advisors still believe that investors should have some form of exposure to Chinese stocks for the long-term success of their portfolio. After all, China is the second-largest economy in the world by Gross Domestic Product (GDP).
Chinese tech stocks are rebounding in the U.S. stock market today following the rebound in Hong Kong earlier today. The renewed interest in Chinese stocks was fueled by a report that Charlie Munger’s Daily Journal Corp. had increased its Alibaba stake by 83% last quarter. On top of all that, President Joe Biden’s plan to meet with Chinese President Xi Jinping before the end of the year also appears to help lift the market sentiment right now.
Also, most Chinese companies are performing well operationally despite weakness in their stock prices. For instance, Nio (NYSE: NIO) and Xpeng (NYSE: XPEV) continue to post record monthly vehicle deliveries. The companies are doing so while facing supply chain challenges. Nio delivered 10,628 vehicles globally in September, increasing by 125.7% year-over-year. Meanwhile, Xpeng almost doubled its deliveries in September with 10,412 vehicles delivered. However, both stocks have been under a fair bit of pressure lately. Now that these stocks appear to be recovering, the question is, would they return to their former glory? If you believe so, here is a list of some of the top Chinese tech stocks in the stock market right now.
Best Chinese Stocks To Watch This Month
- Alibaba Group Holding Ltd (NYSE: BABA)
- JD.Com Inc (NASDAQ: JD)
- Baidu Inc (NASDAQ: BIDU)
- Bilibili Inc (NASDAQ: BILI)
Alibaba
First, we will be looking at one of the largest Chinese technology companies today, Alibaba. Essentially, the company provides the tech infrastructure and marketing reach to help businesses engage with users and consumers. Not to mention, it also has a cloud computing segment that provides a complete suite of cloud services. So, when you look at the company’s current stock price, it is not surprising that investors are showing interest.
Just last month, JPMorgan Chase & Co (NYSE: JPM) announced that it will be supporting Alipay to provide a card payment service for Alibaba.com in the U.S. Now, with the payment processing capabilities from JP Morgan, Alipay can now provide better card payment services within the country for Alibaba.com. This is a necessary development for Alibaba as it continues to expand its operations within the U.S.
In addition, the company also launched a new Dropshipping Solutions, alongside new platform tools and a grant program totaling $500,000 in awards. This is to support existing e-commerce businesses and help build up new digital entrepreneurs. Alibaba’s aggressive expansion into the U.S. is not surprising given that its transactions involving U.S. businesses were up by over 150% over the past year. With that in mind, do you think BABA stock is an intriguing opportunity?
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JD.Com
Following that, we have JD.Com. For those unaware, the company mainly operates through two segments, JD Retail, and New Business segment. As the name suggests, JD Retail consists of online retail, online marketplace, and marketing services in China. Consumers could shop for electronic products, home appliances, and other general merchandise on its online marketplace.
While the sentiment on Chinese stocks has been relatively bearish in recent months, JD stock is one of those that pose significant upsides. During the company’s second quarter, it posted net revenues of $39.3 billion, representing an increase of 26.2% year-over-year. Another important metric to note would be its number of active customer accounts. It now has more than 513.9 million, up by 27.4% from the same quarter last year. For an e-commerce platform, these numbers are imperative for the long-term growth of the company.
Besides that, JD also shows leadership flexibility at the top of the chain. The company has appointed Mr. Lei Xu as President of JD.com, Mr. Lijun Xin as CEO of JD Retail, and Mr. Enlin Jin as CEO of JD Health International in September. Thus, the company CEO, Mr. Richard Qiangdong Liu, will have more freedom to formulate long-term strategies for the company while mentoring the younger management for the future of the company. Given all these, would you bet on the future of JD stock?
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Baidu
Another top Chinese tech stock to watch would be Baidu. For most parts, it is a Chinese language Internet search provider. Much like Alphabet’s (NASDAQ: GOOGL) Google search, you could browse for information online, including webpages, news, images, and many more. However, that is not all that it has to offer. Baidu has been putting plenty of emphasis on Intelligent Driving and Autonomous Vehicle (AV) solutions lately.
For instance, Deepway, a Baidu-backed company, unveiled Xingtu, a new smart energy heavy-duty truck in September. The truck boasts a computing power of more than 500 Tera operations per second (TOPS) and ultra-long-distance sensing capabilities of more than 1 kilometer. Powered by Baidu’s AI technology stack and Apollo AV platform, Xingtu sets a standard for next-generation vehicles that we will see in the smart driving era.
On top of that, there was also strategic cooperation formed between Baidu and China Gas Holdings Ltd. The partnership aims to drive digital and intelligent transformation in the energy and power sector with innovative solutions based on Baidu AI Cloud. Various industries are leveraging cloud and AI technology to enhance efficiencies while unlocking values that are yet to be seen. Thus, this puts Baidu in a prime position as its products and offerings are in high demand. All things considered, would BIDU stock be your go-to pick if you’re planning to explore Chinese tech stocks?
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Bilibili
To sum it up, we have the tech and entertainment services company, Bilibili. Put simply, the company provides online entertainment services for the young generations in China. Its platform offers a range of content, including video services, mobile games, and value-added services, as well as comic and audio content. With Chinese stocks showing signs of recovery today, BILI stock could be one to watch for.
After all, the company represents an iconic brand and a leading video community. It builds its community around aspiring users, high-quality content, talented content creators, and most importantly, a strong emotional bond among them. Bilibili also pioneered the “bullet chatting” feature. This is a live commenting function that displays the thoughts and feelings of other audiences viewing the same video.
Furthermore, the company has posted strong results in its second quarter. Bilibili posted total net revenues of $696.2 million for the quarter, an increase of 72% year-over-year. Also, its average monthly active users reached 237.1 million, representing an increase of 38% from the same period in 2020. With such stellar fundamentals, would you consider BILI stock a top Chinese tech stock to watch now?
