BABA(HK:09988) Huaan Securities·2024-11-19 07:36Investment Rating - The investment rating for Alibaba is maintained as "Buy" [2] Core Views - The report highlights significant profit improvement and stabilization of Taobao's monetization rate [2] - For FY25Q2, Alibaba's revenue was 236.5 billion HKD, a year-on-year increase of 5%, slightly below Bloomberg consensus expectations of 239.4 billion HKD [2] - Gross profit reached 92.5 billion HKD, up 8.6% year-on-year, exceeding Bloomberg's consensus of 90.4 billion HKD [2] - Adjusted EBITDA and net profit were reported at 47.3 billion HKD (down 4% year-on-year) and 36.5 billion HKD (down 9% year-on-year), respectively [2] - The report anticipates further improvement in Taobao's monetization rate due to increased merchant penetration and service fee enhancements [2] Financial Performance Summary - For FY2024, Alibaba's revenue is projected at 941.2 billion HKD, with a year-on-year growth of 8.3% [4] - Revenue forecasts for FY2025, FY2026, and FY2027 are 1,006.7 billion HKD, 1,104.4 billion HKD, and 1,192.0 billion HKD, reflecting growth rates of 7.0%, 9.7%, and 7.9% respectively [4] - Non-GAAP net profit is expected to be 157.5 billion HKD for FY2024, with projections of 154.4 billion HKD, 167.9 billion HKD, and 182.4 billion HKD for FY2025, FY2026, and FY2027 [4] - The report indicates a decrease in Non-GAAP net profit for FY2025 by 2% year-on-year, followed by growth in the subsequent years [4] Segment Performance - Taobao's revenue for the quarter was 989.9 billion HKD, a year-on-year increase of 2%, which was below expectations [2] - International digital commerce group revenue was 316.7 billion HKD, up 29% year-on-year, slightly exceeding expectations [2] - Local life group revenue reached 177 billion HKD, a 14% year-on-year increase, slightly above expectations [2] - Cloud business revenue grew by 7.1% year-on-year, with adjusted EBITDA significantly exceeding expectations [2] Profitability Metrics - The adjusted EBITDA for the cloud business was reported at 26.6 billion HKD, reflecting a year-on-year increase of 89% [2] - The report projects a return on equity of 8.08% for FY2024, increasing to 14.02% by FY2027 [7] - The total revenue growth rate is expected to stabilize around 7% to 9% over the forecast period [7]