BOCOM International·2025-10-21 11:24Investment Rating - The report maintains a "Buy" rating for Alibaba (BABA US) with a target price of $200.00, indicating a potential upside of 15.3% from the current price of $173.47 [1][3][15]. Core Insights - The report highlights the long-term growth potential of Alibaba's AI and cloud businesses, emphasizing the company's comprehensive AI strategy and its efforts to restructure its e-commerce framework through instant retail investments [2][8]. - The financial forecasts for Alibaba show a slight increase in total revenue projections for FY26E to RMB 1,040,807 million, reflecting a growth rate of 4.5% [6][10]. - The report notes that Alibaba's stock price has recently experienced a pullback, with projected P/E ratios for FY25/26 at 23 and 21 times, respectively [2][8]. Financial Performance Summary - Revenue Forecasts: Total revenue for FY26E is projected at RMB 1,040,807 million, with a growth rate of 4.5% [6][10]. - Profitability Metrics: Adjusted net profit for FY26E is expected to be RMB 117,622 million, with a net profit margin of 11.3% [6][10]. - Segment Performance: The report provides detailed segment forecasts, indicating that the Chinese e-commerce group is expected to generate RMB 572,000 million in revenue for FY26E, while the cloud intelligence group is projected to reach RMB 151,900 million [9][10]. Business Outlook - E-commerce: The report anticipates that GMV growth will align with market trends, with a focus on the impact of instant retail on user engagement and monetization capabilities [8][9]. - Cloud Business: Revenue growth for the cloud segment is expected to exceed 30%, with stable profit margins [8][9]. - Other Ventures: The report mentions the successful launch of AI products and their integration into various business lines, which may influence overall profitability [8][9].