Ge Long Hui A P P·2025-09-26 03:09Core Viewpoint - The report from China Merchants Securities International reaffirms Alibaba as the preferred target in the Chinese internet sector, raising the target price by 25% to HKD 198 based on SOTP valuation [1] Group 1: Financial Projections - The firm has adjusted its cloud business revenue forecasts for fiscal years 2026-2027 upwards by 3% and 7% respectively, anticipating year-on-year revenue growth of 27% and 25% [1] - Profit margins are expected to remain stable despite the increased revenue forecasts [1] - For fiscal years 2027-2028, the revenue and core net profit forecasts for Alibaba have been raised by no more than 1% due to strong demand and ongoing AI product innovation [1] Group 2: Business Strengths - The report highlights Alibaba's robust execution capabilities and business synergies as key strengths [1] - The company is positioned to be a significant beneficiary of AI advancements due to its comprehensive technology and product layout [1] - The firm maintains a "buy" rating on Alibaba, reflecting confidence in its market leadership and innovation in AI products [1]