Benzinga | Jul 23, 2021 12:23PM EDT

Credit Suisse Downgrades Baozun To Underperform Following Chinese Regulatory Crackdown; Reduced Price Target Signifies 28% Downside

* Credit Suisse analyst Ashley Xu downgraded Baozun Inc (NASDAQ:BZUN) to Underperform from Outperform with a price target of $23, down from $41, implying a 28% downside from Thursday's closing price of $31.87.

* Baozun has faced derating pressure due to a boycott against international apparel brands, the soft performance of Tmall, and a recent sector-wide correction over regulatory concerns.

* Xu sees additional risk from industry headwinds and continuously tightening regulations.

* She presumes a bumpy road ahead despite the company's strong execution.

* Price action: BZUN shares traded lower by 16.1% at $26.75 on the last check Friday.