JD Sport Enters Mexico via Franchise Deal with Grupo Axo
JD Sports Fashion PLC (LSE:JD.) is entering the Mexican market through a franchise agreement with Grupo Axo, marking its first expansion into Latin America. The deal involves opening 140 JD stores and an online business by 2027 using Axo's existing infrastructure. This approach contrasts with JD’s recent acquisition-driven strategy in North America, offering a more capital-efficient route to growth. The Mexican activewear market is valued at $6.5 billion today and expected to exceed $10 billion by 2034, driven largely by the country’s young population. Broker Shore Capital views this as a strategic shift toward lower-risk expansion with quicker returns. The partnership will not impact JD's current financial year but could contribute positively from 2028 onward. Shore Capital maintains a 'hold' rating on JD shares and notes that its valuation is undemanding, below seven times forecast earnings. More details are expected when JD releases interim results on September 23.
Tickers: $JD.
Topics: athleisure market franchising international expansion