Alibaba (BABA)/ 9988 HK; Jack Ma 03 (May 21 - Jun 25)

[winston]

Broker│Opinion

CLSA│Revenue miss, but company expects customer management revenue (CMR) and cloud revenue to improve in 2HFY25

Citi│Mixed results, with revenue miss but profit beat

JPMorgan│E-commerce market share stabilisation will lead to change of story

HSBC Global Research│Gross transaction volume (GTV) growth and profitability on target, next step is monetisation

Goldman Sachs│GTV market share stabilises, with multiple catalysts for monetisation
UBS│Quarterly EBITA beats

Daiwa│E-commerce monetisation rate expected to improve in 2HFY25

Nomura│Disappointing results, outlook improves

Morgan Stanley│CMR misses

Related News: BABA-SW 1FQ Rev. Rises ~4%, In Line, w/ HSD Online GMV Growth

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

Alibaba’s long-awaited China stock link may provide timely boost

This new source of funds can support the shares, which have underperformed those of key rival Tencent

Inflow of up to about US$20 billion into next year.

At last be realised by the end of the month.

Mainland holdings of the stock could reach double-digit percentages, similar to other tech giants.

On Thursday (Aug 15), Alibaba posted an anaemic 4 per cent rise in first-quarter revenue after its Chinese e-commerce business shrank for the first time in at least a year. Profit plunged 27 per cent, dispelling hopes of a quick turnaround.

The next step for the plan is a vote by shareholders at the annual general meeting on Aug 22. If the upgrade to primary listing in Hong Kong is completed by the end of the month, the shares could join Stock Connect on Sep 9 at the earliest.

About US$12 billion in the first six months after inclusion, or about 7 per cent of Alibaba’s total outstanding shares.

Bloomberg: Around US$19.5 billion in inflows, though “this will take time to accumulate and the initial impact will not be as large”.

Source: Bloomberg

https://www.businesstimes.com.sg/compan ... mely-boost

[winston]

vested

Alibaba Group (9988 HK / BABA US) - Re-acceleration of core business growth

Summary (9988 HK): Despite a mixed quarterly result and a weaker-than-expected CMR growth, we believe there are a few positive catalysts on the horizon.

In the near-term, the potential inclusion to the Stock Connect as management targets to complete the conversion of primary listing in Hong Kong by end-Aug, which is subject to shareholders approval at the upcoming AGM on 22 August, and would potentially make the stock eligible to be included into the Stock Connect. In the next few quarters, the re-acceleration of CMR and Cloud revenue growth.

Also, within one to two years, management targets most of their non-core loss-making businesses to break even and to gradually contribute to group profitability.

We believe that patience will be required for these initiatives and positive catalysts to work out and therefore, share price outperformance.

Alibaba bought back 77m ADS at USD5.8b in 1QFY25 (vs USD4.8b in previous quarter). We believe the accelerated buyback should be viewed positively.

The stock is trading at 8.2x forward price-to-earnings (P/E) with revenue and adjusted earnings per share (EPS) are forecasted to grow 8% and -1% YoY in FY2025 respectively.

We finetune our sum-of-the-parts (SOTP) fair value estimate to HKD110.00.

Source: OCBC

[behappyalways]

Breaking down $BABA's Q2 FY2024 income statement
https://x.com/Mayhem4Markets/status/1825366924038955487

[winston]

M Stanley: BABA-W Expected to Attract Max. US$12B in 1st 6 Mths of Inclusion in Southbound Trading of Stock Connects

BABA-W (09988.HK) completed its dual primary listing in Hong Kong at the end of August, marking an important step towards potential inclusion in the Southbound Trading of Stock Connects.

The southbound trading fund inflow is expected to help boost BABA-W's market capitalization, which has evaporated by about three-fourths from its historical highs, according to Nikkei Asia.

The report quoted Laura Wang, Chief China Equity Strategist of Morgan Stanley, as estimating that up to US$12 billion of southbound trading funds will flow into BABA-W in the first six months of its inclusion in the Southbound Trading of Stock Connects, which is equivalent to about 6% of BABA-W's current market value.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN

[winston]

not vested

Alibaba Group - (9988 HK / BABA US) - AI to drive ad tech upgrades and Cloud revenue to accelerate

Summary (9988 HK): Alibaba Cloud held its annual flagship APSARA conference last week and highlighted Alibaba Cloud’s three key strategies:
i) promoting higher cloud adoption among enterprise customers,
ii) providing diversified large language models (LLM) and intelligent computing products and
iii) expanding into overseas markets.

At the conference, it released its latest LLM, Tongyi Qianwen version 2.5 upgrade with an expanded LLM size and a wide range of products and applications with capabilities enhanced by 18% when compared to version 2.0 which was launched in June.

Despite a mixed quarterly result and a weaker-than-expected customer management revenue (CMR) growth, we have highlighted there are a few positive catalysts on the horizon.

The near-term catalyst of the inclusion into the Stock Connect has materialised. In the next few quarters, the re-acceleration of CMR and Cloud revenue growth. Also, within one to two years, management targets most of their non-core loss-making businesses to break even and to gradually contribute to group profitability.

The latest update in its AI and Cloud development demonstrates its commitment and capabilities to leverage AI to better recognise content categories, and prioritise high commercial potential and high quality content for users.

For instance, e-commerce players’ ad-tech is benefiting from AI integration as it is improving algorithm accuracy and boosting merchants’ returns on investment (ROI), thereby improving the overall platform ecosystem.

Despite the recent outperformance in share price, the stock is trading at 9.7x forward price-to-earnings (P/E) which is at -1s.d. to historical average. We lift our sum-of-the-parts (SOTP) fair value estimate to HKD120.00.

Source: OCBC

[behappyalways]

Bets against Chinese stocks grow as $1.415M of $BABA $90 puts were bought this morning expiring 1/17/25.
https://x.com/Mayhem4Markets/status/1846944434744594557

[winston]

vested

Alibaba to pay US$433m settlement

Agreed to pay US$433.5 million (HK$3.37 billion) to settle a US class-action lawsuit filed by investors alleging monopolistic practices.

Alibaba denied wrongdoing, saying it entered the settlement to avoid the cost and disruption of further litigation.

The lawsuit alleged that Alibaba claimed it did not violate anti-monopoly or unfair competition laws, despite requiring merchants to choose only one distribution platform.

Source: Reuters

https://www.thestandard.com.hk/section- ... settlement

[winston]

China’s Alibaba misses quarterly revenue estimates, beats on profit

Alibaba reported revenue of 236.50 billion yuan (S$43.9 billion) for the second quarter ended Sep 30, compared with analysts’ average estimate of 240.17 billion yuan.

Revenue from Alibaba’s Cloud Intelligence division jumped 7 per cent to 29.61 billion yuan, boosted by the increasing adoption of artificial intelligence technologies.

Growth in Alibaba’s international e-commerce unit, where revenue rose 29 per cent to 31.67 billion yuan, thanks to growing demand around the world for lower-priced goods from China.

Source: Reuters

https://www.businesstimes.com.sg/compan ... ats-profit

[winston]

vested

<Research>G Sachs Rates BABA-W (09988.HK) at Buy; Soft Qtr Results in Line

Goldman Sachs released a report noting that BABA-W (09988.HK)'s quarterly results were weak, but generally in line with expectations.

The broker believed the slight negative reaction in the stock price was mainly due to Taobao-Tmall's GMV growth being below expectations and the QoQ decline in Taobao-Tmall EBITA/Group EBITA deepening.

Related News: JPM Trims BABA-W (09988.HK) TP to $117 as GMV Growth Compressed by Weak Macro

However, as BABA-W management's guidance for 3FQ remains relatively optimistic, the broker expected BABA-W's CMR growth to accelerate to 5.4% and 6.2% in 3FQ and 4FQ respectively, up from previous forecasts of 4.6% and 5.7%.

The broker maintained a Buy rating on BABA-W, with a target price of $131.

Source: AAStocks Financial News

http://www.aastocks.com/en/stocks/news/ ... -news/AAFN