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

[winston]

vested

Alibaba Group (9988 HK)

2QFY24 Preview: Eyes On Taobao-Tmall’s Focus Strategy; Near-term Growth To Be Spurred By Double 11

Alibaba saw a gradual improvement in consumption recovery in September after a slowdown in July-August.

We expect revenue to grow 7% yoy for 2QFY24, underpinned by merchant initiatives and offset by soft consumption demand.

We reckon revenue growth should recover to high single digits in FY24.

Alibaba still offers an attractive risk-reward opportunity on the back of its restructuring plan.

Maintain BUY with a lower target price of HK$120.00 (US$120.00).

Source: CIMB

https://research.uobkayhian.com/content ... 71ae0ab475

[winston]

vested

Alibaba sites hit by glitches amid shopping festival

by Himo Liu

Several sites under Alibaba (9988), including Taobao, Xianyu, Alibaba Cloud Drive and DingTalk, were reported to be experiencing operational issues, according to mainland media.

Reports indicate that users on social media platforms have provided feedback about malfunctions in Taobao, Xianyu, Chinese largest secondhand trading application, and Alibaba Cloud Drive.

Some users experienced error codes or blank screens on their shopping pages, while others mentioned that their shopping experiences remained unaffected.

In an official DingTalk group related to Alibaba Cloud's customer service support, administrators issued an announcement stating that, starting from 5.44pm yesterday, there were anomalies in accessing Alibaba Cloud's product console and application programming interfaces calls.

Alibaba Cloud engineers are currently urgently intervening and investigating the issue.

And for the Double 11 or Singles Day shopping festival, some users have reported issues with payments on Taobao.

Source: Reuters

https://www.thestandard.com.hk/section- ... g-festival

[winston]

vested

China's Alibaba to scrap cloud unit spinoff in response to US chip curbs

Posted revenue of 224.79 billion yuan ($31.01 billion) in the quarter, compared with analysts' average estimate of 224.32 billion yuan,

It will scrap the spin off of its cloud unit in response to export curbs by the United States on chips used in artificial intelligence applications.

Source: Reuters

https://www.investing.com/news/stock-ma ... ns-3236261

[winston]

Ma cashes out US$870m as Alibaba puts 2 IPOs on ice

by Themis Qi

Will offload a total of 10 million US shares in Alibaba (9988) for US$870 million (HK$6.8 billion) next week,

Decided to end the full spin-off of its cloud unit amid the expanded US chip ban and to suspend the initial public offering of its grocery arm Freshippo amid the disappointing market valuations.

Only its logistic unit Cainiao staying in the pipeline.

Revenue grew 9 percent to 224.8 billion yuan (HK$242 billion), slightly above market estimates of 224.32 billion yuan, as China's retail sales recovered gradually.

The net profit advanced 19 percent yearly to 40.2 billion yuan.

The adjusted net profit swung to 27.7 billion yuan from an adjusted net loss of 20.56 billion yuan one year ago.

Operating margin also improved by 3 percentage points yearly to 15 percent in the second quarter of the financial year ending in March 2024.

Source: The Standard

https://www.thestandard.com.hk/section- ... POs-on-ice

[winston]

vested

Alibaba worth about half of Tencent as demand recovery lags

By Charlotte Yang

Market capitalisation of US$201 billion (RM941.68 billion), while Tencent, focused on social media and gaming, boasts US$391 billion.

Alibaba shares now trade around eight times forward earnings multiples, about half of Tencent’s 16 times.

Source: Bloomberg

https://theedgemalaysia.com/node/690364

[winston]

vested

Alibaba Group (9988 HK / BABA US) - Inline revenue but Cloud spinoff was called off

Summary (9988 HK): While 2QFY24 results was largely in-line with market expectations, the focus was on:-
i) the called off of Cloud business spin-off and
ii) Mr Jack Ma family’s filing to sell 10m BABA ADRs (or around a 0.4% stake), which were negative surprises.

These unexpected events raise concerns about the group’s future growth strategy.

Management highlighted that the cancellation of Cloud spin-off is due to the recent US export restriction on advanced computing chips, which poses uncertainty on the Cloud Intelligence Group.

It is estimated that the Cloud business is valued at around USD39b, accounting for about 10% of the group’s sum of the parts (SOTP) valuation.

That said, the company sees Cloud computing as critical infrastructure for the artificial intelligence (AI) era and will continue to invest and drive growth with AI technology and prioritise public cloud, which is a relatively high margin business.

Hence, Alibaba Cloud is likely to remain a key pillar in the Group, supporting its strategy of “AI-driven technology business.

Management also unveiled the group’s latest strategic roadmap for the next few years:-
i) enhancing the group’s return on invested capital (ROIC) to a double-digit level;
ii) enhancing shareholder value through monetisation of non-core assets, ongoing share buyback and annual dividend payout;
iii) committing investments in core business including e-Commerce, AI, and a multi-year incubation program for strategic level innovation business for the group’s long-term sustained growth.

Share price has reacted negatively overnight and pulled back to the level before the Cloud business distribution was announced.

With a stabilised CMR growth, new initiatives to drive growth and enhance shareholders’ return, we view current valuation is undemanding at 8.6x forward price-to-equity (P/E) with a forecasted 10% YoY revenue growth and low-teens compound annual growth rate (CAGR) in adjusted EBITDA.

However, we believe it will take time for investors to digest various changes and developments as well as waiting for these initiatives to deliver improving financial result. Therefore, the stock may lack catalysts to re-rate in the near-term.

We adjusted down revenue growth forecast by 2-4% in the next two years. While we keep our adjusted net income in FY24 more or less unchanged, we lower FY25 estimate by around 8%. Our SOTP fair value estimate is adjusted to HKD130.00. BUY.

Source: OCBC

[behappyalways]

$BABA is now below its 2014 IPO price.

2014 - Revenue $12.3 Billion per year.
2023 - Revenue $126 Billion per year.
https://twitter.com/TheLongInvest/statu ... 2231336354

[behappyalways]

Jack Ma-backed Ant's profit fell 65% due to RMB7 billion yuan fine
https://www.theedgesingapore.com/capita ... -yuan-fine

[behappyalways]

Jack Ma urges Alibaba to ‘correct course’ in internal memo
https://www.theedgesingapore.com/news/c ... ernal-memo

[winston]

Alibaba: At $72 Per Share Makes No Sense

by Eugenio Catone

Summary

Alibaba's stock price has significantly declined, making it an attractive investment opportunity.

The company's fundamentals remain strong, with solid revenue growth and positive free cash flow.

The Chinese stock market has already discounted the worst-case scenarios, making Alibaba undervalued and potentially poised for a rebound.

Source: Seeking Alpha

https://seekingalpha.com/article/465708 ... s-no-sense