BABA(HK:09988) ZHESHANG SECURITIES·2025-02-13 10:23Investment Rating - The report maintains a "Buy" rating for Alibaba [4]. Core Insights - Alibaba is positioned as a low-valuation, high-growth potential star in the market, focusing on its core businesses of e-commerce, cloud, and logistics [2][7]. - The company has made significant organizational adjustments to stabilize revenue growth in its Taobao and Tmall businesses, while also enhancing shareholder returns [2][18]. - The Qwen AI model is recognized for its leading capabilities internationally, with expectations for accelerated growth in the intelligent cloud business due to advancements in AI [2][45]. Summary by Sections Business Focus and Revenue Stability - Alibaba has restructured to focus on e-commerce, cloud, and logistics, with core business revenue accounting for over 73% of total income [19][24]. - The Taobao and Tmall group's revenue is expected to stabilize, driven by improved operations and a return of small and medium merchants [2][18]. - The company has successfully maintained its GMV share, with recent quarters showing growth exceeding that of the overall retail market [28][30]. AI and Cloud Business Growth - The Qwen model is among the top in international rankings, contributing positively to the cloud business's revenue growth [46][51]. - The intelligent cloud business is projected to see significant revenue increases, with expected growth rates of 10%, 18%, and 18% for FY2025-2027 [62]. Financial Forecast and Valuation - Revenue projections for FY2025-2027 are estimated at 997.2 billion, 1,068.6 billion, and 1,147.3 billion CNY, with corresponding growth rates of 6%, 7%, and 7% [61]. - The forecasted net profit for the same period is 145.5 billion, 164.4 billion, and 183.2 billion CNY, with growth rates of 82%, 13%, and 11% [61][63]. - The DCF valuation method suggests a target price of 133.94 HKD per share, supporting the "Buy" rating [11][65].