BABA(09988) 长江证券·2025-02-17 07:15Investment Rating - The report assigns a "Buy" rating for Alibaba Group (9988.HK) with an initial coverage [9]. Core Insights - The company is entering a new investment cycle, focusing on core business and optimizing its asset structure while enhancing shareholder returns through increased dividends and share buybacks [2][8]. - The strategic shift emphasizes technology innovation and international expansion as key growth drivers, leveraging its infrastructure advantages [6][8]. - The organization has undergone significant restructuring to improve operational efficiency and market value, aiming for profitability across its business lines within 1-2 years [7][29]. Company Overview - Alibaba is transitioning from a diversified business model to a more focused approach, concentrating on its core e-commerce operations while reducing unprofitable ventures [4][16]. - The company reported a revenue of 941.2 billion yuan for FY2024, reflecting an 8% year-on-year growth, and a Non-GAAP net profit of 157.5 billion yuan, up 11% [25][26]. Strategic Focus - The company is prioritizing user-centric strategies and technological advancements, with a commitment to enhancing return on invested capital (ROIC) [25][29]. - The restructuring includes the establishment of six independent business groups to foster agility and responsiveness in the market [29][31]. E-commerce Segment: Taotian Group - Taotian Group is focusing on user-first strategies, optimizing traffic distribution, and enhancing the profitability of its merchant base [5][31]. - The platform's traffic algorithm is designed to balance paid and organic traffic, ensuring equitable exposure for quality merchants [41]. International Expansion and Technology Investment - The company is betting on technology and international markets as key areas for long-term growth, with a focus on localizing operations and innovating business models [6][8]. - The international digital commerce group is expected to drive significant growth, supported by a dual model of cross-border management and logistics efficiency [6][8]. Cost Reduction and Efficiency Improvement - The organization is implementing a "1+6+N" structure to streamline operations and enhance investment management, targeting profitability across its business segments [7][29]. - The company aims to achieve a double-digit ROIC in the future, reflecting improved operational efficiency and reduced financial burdens from past investments [7][29]. Shareholder Returns - Alibaba is increasing its focus on shareholder returns through share buybacks and dividends, enhancing the value proposition for investors [8][9]. - The forecasted net profits for FY2025, FY2026, and FY2027 are projected to be 130.7 billion, 152.3 billion, and 183.6 billion yuan, respectively [8].