Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Equity Bottom-Up

<ul>
<li>Alibaba (BABA) reported C2Q25 top line, non-GAAP op. profit and GAAP net income (4.3%), (10%) and 7.7% vs. our est. and (2.2%), 20% and 9.5% vs. cons.. </li>
<li>As stated in our previous reports, we believe O2O e-commerce will constitute ~20% of China's e-commerce and BABA will capture ~50%. </li>
<li>We maintain BABA's TOP BUY classification and raise TP to US$181</li>
</ul>


Alibaba (BABA) reported C2Q25 top line, non-GAAP op. profit and GAAP net income (4.3%), (10%) and 7.7% vs. our est. and (2.2%), 20% and 9.5% vs. cons.. 
As stated in our previous reports, we believe O2O e-commerce will constitute ~20% of China's e-commerce and BABA will capture ~50%. 
We maintain BABA's TOP BUY classification and raise TP to US$181


[Alibaba (BABA US, BUY, TP US$181) Target Price Change]: C2Q25 Review: Who Will Rescue Meituan?

Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Derivatives

<ul>
<li>
Context:<a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba (9988 HK)</a> reported Q1 results on 29 Aug. Despite a revenue miss, strong cloud growth and its AI chip announcement drove the stock up double digits.</li>
<li>
Highlight: Implied volatility deflated sharply post-earnings, with the September contract down 8.5% and back months also lower, while skew shifted down in parallel.</li>
<li>
Why it matters: Put the current volatility surface into context. This insight can serve as a case study of how earnings-driven repricing can inform positioning ahead of future events.</li>
</ul>



Context:Alibaba (9988 HK) reported Q1 results on 29 Aug. Despite a revenue miss, strong cloud growth and its AI chip announcement drove the stock up double digits.

Highlight: Implied volatility deflated sharply post-earnings, with the September contract down 8.5% and back months also lower, while skew shifted down in parallel.

Why it matters: Put the current volatility surface into context. This insight can serve as a case study of how earnings-driven repricing can inform positioning ahead of future events.


Alibaba (9988 HK): Stock Surges Post-Earnings, Options Market Reprices

External broker reports(aggregated public sources), Mirae Asset Securities

Mirae Asset Securities

External broker reports(aggregated public sources)

Leading full-service brokerage firm in Vietnam. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>Positive medium/long-term outlook intact; retain Buy rating and TP of HK$142 We maintain our Buy rating and target price of HK$142 on Alibaba</li><li>While costs tied to quick commerce will likely pressure near-term earnings, synergies with existing e-commerce operations are already visible, and related earnings should improve over time as scale effects materialize</li><li>Meanwhile, Alibaba has released and open-sourced frontier-level foundation models, and it is reportedly developing its own AI inference chip</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Positive medium/long-term outlook intact; retain Buy rating and TP of HK$142 We maintain our Buy rating and target price of HK$142 on AlibabaWhile costs tied to quick commerce will likely pressure near-term earnings, synergies with existing e-commerce operations are already visible, and related earnings should improve over time as scale effects materializeMeanwhile, Alibaba has released and open-sourced frontier-level foundation models, and it is reportedly developing its own AI inference chipContent is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Alibaba (09988 HK/Buy) Undervalued Relative to Technological Capabilities

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>The September rebalance of the Hang Seng family of indices will use today's closing prices to cap the index constituent weights.  </li>
<li>The net round-trip trade across all stocks across the five indices is estimated at HK$57.55bn (US$7.4bn). There is size to trade in a lot of stocks.</li>
<li>
<a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba (9988 HK)</a> has flipped from a net buy to a net sell following its huge rally yesterday.</li>
</ul>


The September rebalance of the Hang Seng family of indices will use today's closing prices to cap the index constituent weights.  
The net round-trip trade across all stocks across the five indices is estimated at HK$57.55bn (US$7.4bn). There is size to trade in a lot of stocks.

Alibaba (9988 HK) has flipped from a net buy to a net sell following its huge rally yesterday.


HSI, HSCEI, HSTECH, HSIII Index Rebalance: US$7.4bn of Flows Post Capping (Sep 2025)

<ul>
<li>
Context: Volatility cones provide a clear framework to evaluate whether options are trading cheap or rich.</li>
<li>
Highlights:<a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>, <a href="https://www.smartkarma.com/entities/hsbc-holdings-plc" target="_blank" data-smartkarma-citation="entities:516:1" rel="noopener">HSBC (5 HK),</a><a href="https://www.smartkarma.com/entities/meituan" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a>, <a href="https://www.smartkarma.com/entities/ping-an-insurance-grp-co-of-china-ltd" target="_blank" data-smartkarma-citation="entities:12880:1" rel="noopener">Ping An (2318 HK)</a>, and <a href="https://www.smartkarma.com/entities/jd-com-inc" target="_blank" data-smartkarma-citation="entities:29043:1" rel="noopener">JD.com (9618 HK)</a> all display historically cheap implied volatility. Read on for trade suggestions.</li>
<li>
Why Read: Spot opportunities, assess regime shifts, and manage risk effectively — volatility cones turn complex data into actionable insights for traders and investors.</li>
</ul>



Context: Volatility cones provide a clear framework to evaluate whether options are trading cheap or rich.

Highlights:Tencent (700 HK), HSBC (5 HK),Meituan (3690 HK), Ping An (2318 HK), and JD.com (9618 HK) all display historically cheap implied volatility. Read on for trade suggestions.

Why Read: Spot opportunities, assess regime shifts, and manage risk effectively — volatility cones turn complex data into actionable insights for traders and investors.


Cheap Vs. Rich Volatility: What Cones Reveal in Tencent, HSBC, Meituan & More

China

Alibaba Group Holding Limited provides online sales services. The Company provides internet infrastructure, electronic commerce, online financial, and internet content services through its subsidiaries. Alibaba Group Holding offers its products and services worldwide.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Alibaba (9988 HK)

[Alibaba (BABA US, BUY, TP US$181) Target Price Change]: C2Q25 Review: Who Will Rescue Meituan?

Alibaba beats earnings estimates, poised to dominate O2O e-commerce in China with a 50% market share, leading to a top buy rating and increased...

Blue Lotus Research Institute

Alibaba (9988 HK): Stock Surges Post-Earnings, Options Market Reprices

Alibaba's Q1 results drive stock up 12% despite revenue miss. Implied volatility deflated post-earnings, offering insight for future positioning.

Gaudenz Schneider

Alibaba (09988 HK/Buy) Undervalued Relative to Technological Capabilities

Positive medium/long-term outlook intact; retain Buy rating and TP of HK$142 We maintain our Buy rating and target price of HK$142 on Alibaba

Mirae Asset Securities

HSI, HSCEI, HSTECH, HSIII Index Rebalance: US$7.4bn of Flows Post Capping (Sep 2025)

The Sep rebalance of the HSI, HSCEI, HSTECH, HSIII, HSHKBIO indices will use today's closing prices for capping. The round-trip trade across the...

Brian Freitas

Cheap Vs. Rich Volatility: What Cones Reveal in Tencent, HSBC, Meituan & More

Volatility cones help identify cheap options trading opportunities in Tencent, HSBC, Meituan, Ping An, and JD.com, providing actionable insights...

Gaudenz Schneider

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Alibaba (BABA US, BUY, TP US$181) Target Price Change]: C2Q25 Review: Who Will Rescue Meituan?

​Alibaba beats earnings estimates, poised to dominate O2O e-commerce in China with a 50% market share, leading to a top buy rating and increased...

Blue Lotus Research Institute

Alibaba (9988 HK): Stock Surges Post-Earnings, Options Market Reprices

​Alibaba's Q1 results drive stock up 12% despite revenue miss. Implied volatility deflated post-earnings, offering insight for future positioning.

Gaudenz Schneider

Alibaba (09988 HK/Buy) Undervalued Relative to Technological Capabilities

Positive medium/long-term outlook intact; retain Buy rating and TP of HK$142 We maintain our Buy rating and target price of HK$142 on Alibaba

Mirae Asset Securities

HSI, HSCEI, HSTECH, HSIII Index Rebalance: US$7.4bn of Flows Post Capping (Sep 2025)

The Sep rebalance of the HSI, HSCEI, HSTECH, HSIII, HSHKBIO indices will use today's closing prices for capping. The round-trip trade across the...

Brian Freitas

Cheap Vs. Rich Volatility: What Cones Reveal in Tencent, HSBC, Meituan & More

​Volatility cones help identify cheap options trading opportunities in Tencent, HSBC, Meituan, Ping An, and JD.com, providing actionable insights...

Gaudenz Schneider

Alibaba beats earnings estimates, poised to dominate O2O e-commerce in China with a 50% market share, leading to a top buy rating and increased...

Alibaba's Q1 results drive stock up 12% despite revenue miss. Implied volatility deflated post-earnings, offering insight for future positioning.

Volatility cones help identify cheap options trading opportunities in Tencent, HSBC, Meituan, Ping An, and JD.com, providing actionable insights...