Jinwu Financial News | According to the First Shanghai Development Research Report, Alibaba (09988) e-commerce GMV experienced good growth this quarter, indicating that the e-commerce business may have reached a turning point after experiencing continuous competition over the past few years. The bank believes that the performance in the second half of the year is particularly important. Additionally, in June 2024, the company will pay regular dividends and a one-time special dividend for the fiscal year 2024, totaling approximately US$4 billion. The company plans to complete the second conversion to a dual major listing in Hong Kong in August 2024, and it is expected that it will be included in the Hong Kong Stock Connect in the future if it meets the conditions.
The bank mentioned that revenue from core public cloud products recorded a double-digit year-on-year increase and AI-related revenue recorded a three-digit year-on-year increase in this quarter. In the future, the share of public cloud revenue will continue to increase, and project-based contracts will continue to decrease, so the profit margin of the cloud business is expected to increase further.
The bank expects revenue for the 2025-2027 fiscal year to be 10,239/11,001/11,951 billion yuan, operating profit of 1,205/1,458/169 billion yuan, and diluted earnings per share of $5.1/6.2/7.3. Using the segmented valuation method, a target price of $115.00/HK$113.00 was obtained, and the purchase rating was obtained.