BABA(HK:09988) GF SECURITIES·2024-11-26 07:53Investment Rating - The report maintains a "Buy" rating for both US and Hong Kong stocks of Alibaba, with a current price of 83.13 USD and 80.70 HKD, respectively, and a target value of 119.95 USD and 116.69 HKD [6]. Core Insights - Alibaba's FY25Q2 revenue increased by 5% year-on-year to 236.5 billion RMB, while adjusted EBITA decreased by 5.3% to 40.56 billion RMB, resulting in a margin of 17.2%. The company repurchased 405 million ordinary shares valued at 4.1 billion USD, reducing the share capital by 2.1% compared to FY24Q2 [2]. - Taobao Group's revenue grew by 1% year-on-year to 98.99 billion RMB, with EBITA declining by 5% to 44.59 billion RMB. The GMV showed growth, and the monetization rate remained stable, with CMR revenue increasing by 2.5% to 70.36 billion RMB, driven by a double-digit growth in 88VIP users [3]. - Cloud Intelligence Group's revenue rose by 7% year-on-year to 29.61 billion RMB, with adjusted EBITA increasing by 89% to 2.66 billion RMB. Public cloud maintained double-digit growth, and AI-related revenue saw triple-digit year-on-year growth [3]. - The report forecasts Alibaba's non-GAAP net profit for FY2025-2027 to be 160.5 billion, 187.9 billion, and 205.7 billion RMB, respectively, applying a 10X PE valuation for Chinese commercial profits and a 2X PS valuation for cloud computing revenue [4]. Financial Summary - For FY2025, Alibaba's projected revenue is 1,008.07 billion RMB, with a growth rate of 7.1%. Non-GAAP EBITA is expected to be 164.54 billion RMB, and non-GAAP net profit is projected at 160.50 billion RMB, reflecting a growth rate of 1.4% [5]. - The report outlines a steady increase in revenue and profit margins over the next few years, with a projected non-GAAP EPS of 67.2 RMB per ADS for FY2025, and a decreasing non-GAAP P/E ratio from 9.9 in FY2023 to 6.9 in FY2027 [5].