Goldman Sachs: Maintains "buy" rating on Alibaba-SW (09988) with a target price of 105 Hong Kong dollars.

Goldman Sachs released a research report stating that it maintains a "buy" rating for Alibaba-SW (09988) with a target price of 105 Hong Kong dollars. In the report, the bank pointed out that Alibaba's year-to-date Gross Merchandise Volume (GMV) growth has accelerated; it continues to be optimistic about Customer Management Revenue (CMR) growth for Taobao and Tmall. Due to the upgrade of advertising technology tools, recent software service fee increases are expected to drive profitability normalization by the second half of the 2025 fiscal year, including narrowing the gap between GMV and CMR. Although the group's EBITDA has declined in the short term due to the high base effect, the bank believes that earnings per share will improve in the third and fourth quarters ending in December and March this year, as well as in the 2026 fiscal year, as revenue growth recovers, further driving valuation re-rating. The bank continues to believe that the valuation of Alibaba is attractive, considering the valuation of Taobao and Tmall, without assigning any value to the cloud business or international business, as well as the ongoing shareholder return strategy and potential inflow of funds from the south. On the other hand, the bank mentioned that Alibaba Cloud is at the peak of AI-led cloud infrastructure, and predicts that revenue growth for Alibaba Cloud will accelerate, with visible synergies between AI and the company's core business.