We believe the sustained strong momentum of China online retail sales bodeswell for eCommerce leaders. We stay OW on BABA and JD.    BABA guides for strong top line but more investment; JD remains confident inrevenue growth and margin expansion: As we discussed in our previous Alibabareport (link here), BABA's management is quite confident about its robust topline growth this year, while planning more investment on New Retail (e.g. Intime,Hema) and target categories (e.g. FMCG and electronics). Also, JD's managementremains positive on long-term revenue drivers and is committed on marginexpansion (link here). It advised investors to focus more on annual rather thanquarterly margin trend. We are likely to see the overall online retail sales remainhealthy trend, indicating strong GMV growth for both BABA and JD; but we alsoexpect more aggressive discount, advertising, and other ways of useracquisition/retention, which should lead to faster online share gains from offline.

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