Greater China Equity Long/Short Analyst

Eric Chen

Equity Bottom-Up

<ul>
<li>The sector sees dramatic improvement in profitability and cashflow thanks to cutback on marketing expenses and headcount reduction.</li>
<li>Topline growth is recovering but still clouded by sluggish macro conditions. It is understandable that investors treat these China proxies – one way or another – with caution.</li>
<li>The sector’s valuation will remain pressured before the property market stabilizes and key macro indicators show concrete signs of improvement, in our view.</li>
</ul>


The sector sees dramatic improvement in profitability and cashflow thanks to cutback on marketing expenses and headcount reduction.
Topline growth is recovering but still clouded by sluggish macro conditions. It is understandable that investors treat these China proxies – one way or another – with caution.
The sector’s valuation will remain pressured before the property market stabilizes and key macro indicators show concrete signs of improvement, in our view.


China Online Marketplaces: Recap of 2Q Results

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>News broke yesterday that Daniel Zhang is no longer leading <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba (ADR) (BABA US)</a>'s Cloud Business unit.</li>
<li>The statement from Alibaba's current chairman, in which he mentions that Zhang would "switch to a different approach and continue to fight alongside us at Alibaba" raises skepticism.</li>
<li>We also think that the $1.0bn Alibaba committed to a technology fund could be seen as a form of compensation to ensure Daniel Zhang's silence.</li>
</ul>


News broke yesterday that Daniel Zhang is no longer leading Alibaba (ADR) (BABA US)'s Cloud Business unit.
The statement from Alibaba's current chairman, in which he mentions that Zhang would "switch to a different approach and continue to fight alongside us at Alibaba" raises skepticism.
We also think that the $1.0bn Alibaba committed to a technology fund could be seen as a form of compensation to ensure Daniel Zhang's silence.


Alibaba: Daniel Zhang Shown The Door, Jack Ma Back In The Game

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>Alibaba Group Holding Limited managed to exceed expectations in terms of revenue and earnings.</li><li>Their team's efforts to create a thriving ecosystem and realize technology-driven innovation methods also show promising results.</li><li>The overall sales growth for the Alibaba International Digital Commerce Group was 41%, and the retail division had revenue growth of 60% year over year.</li></ul>

Alibaba Group Holding Limited managed to exceed expectations in terms of revenue and earnings.Their team's efforts to create a thriving ecosystem and realize technology-driven innovation methods also show promising results.The overall sales growth for the Alibaba International Digital Commerce Group was 41%, and the retail division had revenue growth of 60% year over year.

Alibaba Group Holding Limited: Making Huge Strides In AI Which Could Prove A Growth Catalyst! – Key Drivers

<ul>
<li>
<a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba (ADR) (BABA US)</a>'s New Retail strategy stumbled, prompting the company to revert to its e-commerce origins with a renewed emphasis on social commerce.</li>
<li>Creating a social media platform could be relatively simple, yet turning it into a prosperous venture amid established social media giants could be challenging.</li>
<li>Branching out from social media to e-commerce might be straightforward, but <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 Group Holding (9988 HK)</a>'s unprecedented reverse path could present unique challenges.</li>
</ul>



Alibaba (ADR) (BABA US)'s New Retail strategy stumbled, prompting the company to revert to its e-commerce origins with a renewed emphasis on social commerce.
Creating a social media platform could be relatively simple, yet turning it into a prosperous venture amid established social media giants could be challenging.
Branching out from social media to e-commerce might be straightforward, but Alibaba Group Holding (9988 HK)'s unprecedented reverse path could present unique challenges.


China/Asia TMT, Blue Lotus Research Institute

Shawn Yang

China/Asia TMT

China TMT research

Blue Lotus Research Institute

​​​​​​​​Blue Lotus is a China headquartered research institution covering overseas listed China TMT stocks. 

<ul>
<li>Taobao and Tmall have implemented two major reforms: 1) The launch of the Wanxiangtai Platform Unlimited Edition; 2) Changing the rules for displaying merchant sales volume from monthly to annual.</li>
<li>Although the new Wanxiangtai differs from PDD’s "Fangxintui" and "Quanzhantui" , the idea is to simplify and automate merchant promotion. We anticipate that this change will boost the take rate.</li>
<li>We increased our core e-commerce take rate estimate for BABA in FY24/FY25 to 3.85%/4.0%, respectively, and raised our TP to US$ 127.</li>
</ul>


Taobao and Tmall have implemented two major reforms: 1) The launch of the Wanxiangtai Platform Unlimited Edition; 2) Changing the rules for displaying merchant sales volume from monthly to annual.
Although the new Wanxiangtai differs from PDD’s "Fangxintui" and "Quanzhantui" , the idea is to simplify and automate merchant promotion. We anticipate that this change will boost the take rate.
We increased our core e-commerce take rate estimate for BABA in FY24/FY25 to 3.85%/4.0%, respectively, and raised our TP to US$ 127.


[Alibaba (BABA US, BUY, TP US$127) TP Change]: The New Wanxiangtai Will Enhance the Take Rate

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.

52-week Range	0.00 - 0.00
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Alibaba (ADR) (BABA US)

China Online Marketplaces: Recap of 2Q Results

The sector shows improved profitability and cashflow due to reduced marketing expenses and headcount. Yet cautious sentiment persists amidst...

Eric Chen

Alibaba: Daniel Zhang Shown The Door, Jack Ma Back In The Game

Yesterday, Daniel Zhang left Alibaba's Cloud Business unit. The chairman's statement about Zhang's future role raises doubts, and the $1 billion...

Oshadhi Kumarasiri

Alibaba Group Holding Limited: Making Huge Strides In AI Which Could Prove A Growth Catalyst! – Key Drivers

Alibaba Group Holding Limited managed to exceed expectations in terms of revenue and earnings. Their team's efforts to create a thriving ecosystem...

Baptista Research

Alibaba: Navigating in Reverse

Initially succeeding in social media and branching into e-commerce could be relatively simple. Yet, attempting the reverse approach, as Alibaba...

Oshadhi Kumarasiri

[Alibaba (BABA US, BUY, TP US$127) TP Change]: The New Wanxiangtai Will Enhance the Take Rate

Taobao and Tmall have implemented two major reforms: 1) The launch of the Wanxiangtai Platform Unlimited Edition; 2) Changing the rules for...

Blue Lotus Research Institute

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)