Investment Rating - The report assigns a "Buy" rating for Alibaba Group (09988.HK) with a target price of HK$ 150 [1][7]. Core Insights - Alibaba's FY25 Q4 revenue reached RMB 236.45 billion, a year-on-year increase of 7%, slightly below market expectations of RMB 237.91 billion. The net profit attributable to ordinary shareholders was RMB 12.382 billion, showing a significant year-on-year growth of 279% [8]. - The report highlights strong growth in the Taobao Group's revenue, which increased by 12% year-on-year to RMB 71.077 billion in FY25 Q4, driven by an increase in commission rates and a growing 88VIP membership base [11]. - The cloud intelligence business faced challenges, with revenue of RMB 30.127 billion in FY25 Q4, a year-on-year increase of 18%, but slightly below market expectations due to prior R&D expenses and depreciation affecting profit margins [11]. - The report anticipates continued high investment in AI and cloud computing infrastructure, projecting over RMB 380 billion in investments over the next three years, which is expected to exceed the total of the past decade [11]. Summary by Sections Financial Performance - FY25 Q4 revenue: RMB 236.45 billion, YoY +7% [8] - Net profit attributable to ordinary shareholders: RMB 12.382 billion, YoY +279% [8] - Non-GAAP net profit: RMB 29.85 billion, YoY +22% [8] Revenue Breakdown - Taobao Group FY25 Q4 revenue: RMB 71.077 billion, YoY +12% [11] - International Digital Commerce Group FY25 Q4 revenue: RMB 27.603 billion, YoY +24% [11] - Cloud Intelligence Group FY25 Q4 revenue: RMB 30.127 billion, YoY +18% [11] Profit Forecast - Projected net profit for FY2026-2028: RMB 141.8 billion, RMB 153.0 billion, RMB 164.7 billion respectively, with YoY growth rates of 9.0%, 7.9%, and 7.7% [11]. - Projected EPS for FY2026-2028: RMB 7.46, RMB 8.05, RMB 8.67 [11]. Valuation Metrics - H-share P/E ratios for FY2024 to FY2028 are projected to be 31.50, 15.90, 14.69, 13.61, and 12.64 respectively [10]. - Dividend per share (DPS) is projected to be RMB 1.61, RMB 0.94, RMB 2.10, RMB 2.20, and RMB 2.30 for FY2024 to FY2028 [10]. Capital Expenditure - FY25 Q4 capital expenditure was RMB 24.512 billion, a quarter-on-quarter decrease of approximately 22%, indicating lower-than-expected demand in the AI sector [11].

Investment Rating - The report assigns a "Buy" rating for Alibaba Group [7][8]. Core Insights - Alibaba's FY25 Q4 revenue reached RMB 236.45 billion, a year-on-year increase of 7%, slightly below market expectations of RMB 237.91 billion. The net profit attributable to ordinary shareholders was RMB 12.382 billion, showing a significant year-on-year growth of 279% [8]. - The report highlights strong growth in the Taobao Group's revenue, which increased by 12% year-on-year to RMB 71.077 billion in FY25 Q4, driven by an increase in commission rates and a growing 88VIP membership base [11]. - The cloud intelligence business faced pressure, with revenue of RMB 30.127 billion in FY25 Q4, a year-on-year increase of 18%, but slightly below market expectations due to prior R&D expenses and depreciation [11]. - The report anticipates continued high investment in AI and cloud computing, with expected capital expenditures exceeding RMB 380 billion over the next three years [11]. Summary by Sections Company Overview - Alibaba operates in the commerce and retail industry, with a market capitalization of HK$ 175.28 billion and a share price of HK$ 119.10 as of May 25, 2022 [2]. Financial Performance - FY25 Q4 net profit was RMB 119.73 billion, a year-on-year increase of 1203%, attributed to changes in equity investments and operational profit growth [8]. - The report projects net profits for FY2026-2028 to be RMB 141.8 billion, RMB 153 billion, and RMB 164.7 billion, respectively, with year-on-year growth rates of 9.0%, 7.9%, and 7.7% [11]. Market Position - The report notes that the Taobao Group and international business segments maintain high growth rates, while the local life group continues to face challenges due to competition in the food delivery sector [11].

Investment Rating - The report maintains a "Buy" rating for Alibaba Group [2][6] Core Insights - Alibaba's FY3Q25 performance exceeded expectations with revenue of 280.15 billion yuan, a year-on-year increase of 7.6%, and adjusted net profit of 51.07 billion yuan, up 6.5% [4][6] - The company is entering a new growth cycle driven by AI, with significant capital expenditure planned to enhance cloud computing and AI infrastructure [4][9] - The report highlights improvements in operational efficiency and a reduction in losses across various business segments, particularly in local services and international commerce [4][6] Financial Performance Summary - **Revenue and Profitability**: FY3Q25 revenue was 2801.5 billion yuan, exceeding Bloomberg consensus of 2774 billion yuan; adjusted net profit was 510.7 billion yuan, significantly above the expected 455 billion yuan [4][6] - **Taobao Group**: Revenue reached 1360.9 billion yuan, a 5.4% year-on-year increase, with adjusted EBITA of 610.8 billion yuan, up 1.9% [4][6] - **Cloud Intelligence Group**: Revenue was 317.4 billion yuan, a 13.1% increase, with adjusted EBITA of 31.4 billion yuan, up 32.7% [4][6] - **International Digital Commerce**: Revenue grew by 32.4% to 377.6 billion yuan, driven by growth in AliExpress and Trendyol [4][6] - **Capital Expenditure**: FY3Q25 capital expenditure was 317.8 billion yuan, a 258.8% increase year-on-year, reflecting a strong commitment to AI and cloud infrastructure [4][6] Earnings Forecast and Valuation - Projected revenues for FY2025-2027 are 10046 billion yuan, 11230 billion yuan, and 12545 billion yuan respectively, with adjusted net profits of 1577 billion yuan, 1656 billion yuan, and 1863 billion yuan [6][22] - The estimated market capitalization based on segment valuation is 30703 billion yuan, corresponding to a target price of 175.10 HKD per share [6][22]

Investment Rating - The report maintains a "Buy" rating for Alibaba [2][6][22] Core Insights - Alibaba's FY3Q25 performance exceeded expectations with revenue of 2801.5 billion yuan, a year-on-year increase of 7.6%, and adjusted net profit of 510.7 billion yuan, up 6.5% [4][6] - The company is entering a new growth cycle driven by AI, with significant capital expenditure planned to enhance cloud computing and AI infrastructure [4][9][22] Financial Performance - Alibaba's revenue for FY3Q25 was 2801.5 billion yuan, surpassing Bloomberg consensus of 2774 billion yuan [4] - Adjusted net profit for FY3Q25 was 510.7 billion yuan, significantly above the expected 455 billion yuan [4] - The company's capital expenditure for FY3Q25 reached 317.8 billion yuan, a year-on-year increase of 258.8% [4][9] Business Segments - Taobao Group generated revenue of 1360.9 billion yuan in FY3Q25, a year-on-year increase of 5.4% [4] - Cloud Intelligence Group reported revenue of 317.4 billion yuan, up 13.1% year-on-year, driven by strong demand for AI-related services [4] - International Digital Commerce achieved revenue of 377.6 billion yuan, a year-on-year increase of 32.4% [4] Future Outlook - The report forecasts Alibaba's revenue for FY2025-2027 to be 10046 billion yuan, 11230 billion yuan, and 12545 billion yuan respectively [6][22] - Adjusted net profit is projected to be 1577 billion yuan, 1656 billion yuan, and 1863 billion yuan for FY2025-2027 [6][22] - The company plans to invest over 3800 billion yuan in AI and cloud computing infrastructure over the next three years [9][22]