Morgan Stanley Reviews Vipshop Earnings

In a report published Thursday, Morgan Stanley analysts maintained an Overweight rating on

, after the company reported robust 1Q15 results. Vipshop's results were driven by better than-expected product and other revenues. The company's total net revenue, at US$1,389 million, grew 98 percent y/y and 2 percent q/q. "This was also higher than our forecast by 8%, mainly due to a 7% beat in product revenue (98% of total net revenue) and 65% beat in other revenue," the analysts stated. The company reported a 74 percent y/y and 6 percent q/q increase in its active customers. The growth was, however, short of the Morgan Stanley forecast because of difficult y/y comps due to the Lefeng acquisition in February 2014. Vipshop's non-GAAP net income rose 104 percent y/y to US$77 million, beating the Morgan Stanley estimate by 17 percent. "This was mainly driven by 8% top line beat, partially offset by 10% higher-than-expected operating expense," the analysts mentioned. The company guided to 2Q15 net revenues of $1.41-$1.44 billion, implying 69-73 percent y/y growth (71-75 percent y/y growth in RMB).