Citi released a research report stating that it maintains a 'buy' rating for Alibaba-SW (09988). For the second quarter of the 2025 fiscal year, the bank slightly adjusted the EBITA assumption for Tmall Group to reflect reinvestment in user experience improvement, merchant support, and market promotion expenses. The target price for H shares has been adjusted accordingly to 133 Hong Kong dollars. The bank believes that management's latest comments and performance on cloud and international business are also the focus of this conference call.
The report states that facing the upcoming financial results for the quarter ending in late September, it is believed that Alibaba investors' focus will be on macroeconomic outlook and consumer sentiment, as well as whether the latest and upcoming stimulus measures can translate into strong demand for the November 11 promotion.
The bank believes that investors will be eager to hear the latest news on new users and conversion rates brought by Tmall Group's deepening cooperation with internet platforms, especially with WeChat Pay, including the effectiveness of new advertising tools and merchant adoption, as well as the impact of the 0.6% fee charge.
