Vipshop's leverage, as measured by debt/EBITDA, has improved to 0.6x for the 12 months ended 30 September 2020 from 2.1x at 30 September 2018, driven primarily by the repayment of its convertible bond in March 2019. Moody's expects the company's leverage will stay well below 1.0x in the next 12-18 months, supported by steady growth in earnings and operating cash flow. The company's net cash position will increase further to over RMB8.0 billion in next 12-18 months from RMB3.7 billion in 2019. Vipshop's liquidity remains excellent, supported by cash and cash equivalents of RMB8.9 billion and short-term investments of RMB4.9 billion as of September 2020. We expect the company will generate operating cash flow of RMB 5-6 billion in the coming 12 months. These are more than sufficient to cover its outstanding maturing debt of RMB1.3 billion and the expected capital spending of RMB3.0 billion in the next 12 months.