Can the two-way shareholding of 8.3 billion Hong Kong dollars between SF Express and J&T achieve a result where 1+1>2?

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On January 15, SF Holding and J&T Express jointly announced that both parties had signed a Subscription Agreement. According to the agreement, SF will subscribe to 822 million newly issued Class B shares of J&T through its wholly-owned overseas subsidiary.

Currently, SF Holding owns 150 million shares of J&T Express, accounting for approximately 1.67% of J&T's issued shares. After the issuance and delivery of J&T shares, SF will hold 10% of the total issued shares of J&T Express. Meanwhile, SF will issue 226 million new H shares to J&T. Upon completion, J&T’s stake in SF will become 4.29%. The transaction consideration for both parties is approximately HKD 8.3 billion.

According to the Subscription Agreement, both parties have set a five-year share lock-up period, during which they are prohibited from directly or indirectly offering, selling, agreeing to sell, granting any options, conducting any short-selling, or otherwise disposing of any J&T shares. In addition to the lock-up period, SF also stated that it would continue to hold no less than 8% of J&T Express shares.

How will the strong alliance between the two parties bring changes to SF?

Decline in per-ticket revenue

In recent years, with the intensifying competition in the express delivery industry, SF's performance has also been affected to a certain extent.

In 2022-2024, SF's revenue was RMB 267.5 billion, RMB 258.4 billion, and RMB 284.4 billion respectively, with year-on-year growth of 29.1%, -3.39%, and 10.1%; net profit attributable to shareholders was RMB 6.17 billion, RMB 8.23 billion, and RMB 10.2 billion, increasing by 44.6%, 33.4%, and 23.5% year-on-year respectively. In the first three quarters of 2025, SF’s revenue reached RMB 225.261 billion, growing by 8.89% year-on-year; net profit attributable to shareholders was RMB 8.308 billion, up 9.07% year-on-year.

Notably, in the first half of 2025, SF’s operating revenue reached RMB 146.9 billion, increasing by 9.3% year-on-year, with total volume reaching 7.85 billion tickets, growing by 25.7% year-on-year. The significant growth in total volume far outpaced revenue growth, indicating that its per-ticket price is declining.

In its 2024 annual report, SF stated that it established the strategic direction of “accelerating industrial transformation,” speeding up the shift from the traditional “selling products” to “selling solutions.” By building comprehensive logistics solutions and standardized packages tailored to different industries and scenarios, SF aims to accelerate its expansion into supply chains across various industries, thereby increasing its logistics market share.

In its Q3 2025 earnings report, SF stated that revenue growth for its mid-to-high-end time-sensitive business improved sequentially in Q3 2025. Regarding its industrial strategy, the company achieved high logistics revenue growth exceeding 25% year-on-year in sectors such as industrial equipment, communications and high-tech, automotive, and consumer goods.

However, SF’s per-ticket price continues to decline. In the first half of 2025, SF’s average revenue per ticket was RMB 14, down 12.2% year-on-year. According to SF's November 2025 express logistics business operation brief, its per-ticket revenue in November 2025 was RMB 13.47, a year-on-year decrease of 8.49%.

At the Q3 2025 earnings briefing, SF Express stated that under the 'existing and then optimizing' strategy, the company launched the 'Enhancement Plan.' Through reasonable pricing, it aims to optimize its client structure with a focus on increasing the proportion of high-value clients.The pressure on Q3 performance was due to the fact that the effects of some improvement measures require a certain transmission period, and their positive impact will be gradually released in subsequent quarters.

However, domestic industry-wide pressures continue to affect SF Express. According to data from the National Bureau of Statistics, in 2025, the express delivery volume reached 199 billion pieces, a year-on-year increase of 13.7%, while express delivery revenue amounted to 1.5 trillion yuan, a year-on-year increase of 6.5%. Based on these figures, the average price per express order nationwide in 2025 was approximately 7.54 yuan, compared to 8.02 yuan in 2024.

Doubling down on international business

Facing domestic pressures, SF Express has identified international business as its second growth line.

In 2021, SF Express spent 17.555 billion yuan acquiring Kerry Logistics to expand its Southeast Asian distribution network. In 2024, SF Express listed on the Hong Kong Stock Exchange, with 45% of the proceeds allocated for 'strengthening international and cross-border logistics capabilities.'

In the first half of 2025, revenue from SF Express's supply chain and international division reached 35.768 billion yuan, a year-on-year increase of 8.67%, accounting for 24.36% of total revenue, making it the company's second-largest business line. However, this division is currently in a loss-making state – with a net loss of approximately 300 million yuan in the first half of 2025, representing a year-on-year reduction in losses of 48.47%. SF Express stated that excluding the 430 million yuan loss from its overseas subsidiary KEX and the 290 million yuan financing interest expenses related to the acquisition of KLN, the supply chain and international division achieved a net profit of 430 million yuan in the first half of 2025, an increase of 178% year-on-year.

In its financial report, SF Express stated that the company further strengthened its end-to-end cross-border and local operational capabilities for air, sea, and land transport, customs clearance, and last-mile delivery from China to Southeast Asia and South Asia. It provided supply chain services such as raw material cross-border transportation, semi-finished products & spare parts overseas warehousing and distribution, and overseas finished product exports to clients in industries like apparel and footwear, communications and high-tech, industrial equipment, automobiles, and new energy. As of the first half of 2025, over 95% of Fortune China 500 companies have cooperated with SF Express, with more than 60% using SF Express's international services.

The transaction between SF Express and J&T Express will further enhance SF Express's international influence. The financial report shows that in the first half of 2025, J&T Express held market shares of 32.8%, 11.1%, and 6.2% in Southeast Asia, China, and emerging markets, respectively. According to Frost & Sullivan, in terms of package volume, J&T Express has been the leading express operator in the Southeast Asian market from 2020 to the first half of 2025.

In the announcement, SF Express stated that regarding international business, the group will leverage its core resource advantages and mature operating system in cross-border first-leg and trunk segments to form synergy with J&T Express Group's last-mile delivery network layout and localized operational experience in Southeast Asia and emerging markets. This will expand the network coverage and product competitiveness of its end-to-end cross-border business.In terms of domestic business, the two parties have significant complementary and synergistic potential in network resources, customer base, product structure, and differentiation, which will help both expand their service boundaries. Overall, this cooperation aligns closely with the group’s strategic goal of becoming 'Asia's only, globally covered' logistics provider, offering strong support for the group to further consolidate and enhance its comprehensive competitiveness in the Asian and global logistics markets.

The strategic cooperation between SF Express and J&T Express represents not only a two-way equity investment at the capital level but also a deep synergy between two major logistics giants in terms of business networks, market coverage, and operational capabilities. Amid intensifying competition in the express delivery industry and pressure on per-ticket pricing, SF Express, through its collaboration with J&T Express, will further strengthen its network presence in Southeast Asia and emerging markets, supporting the growth of its international operations.

Author: Wu Ren

Source | Zhengtan Finance (ID: teccj6)

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