CitiThe published research report indicates that althoughAlibaba(9988.HK) reported lower-than-expected overall revenue, while cloud services and customer management revenue growth slowed, although adjusted EBITA and net profit both exceeded expectations. The company's revenue guidance for fiscal year 2022 and the direction of reinvesting profits in new businesses remain unchanged. Citigroup's positive view on Alibaba's expansion of its share buyback program to $15 billion indicates that management is confident in its long-term growth prospects and also reflects Alibaba's strong cash flow production capacity. The bank believes it is prudent for the company to focus on a multi-app strategy, as the industry is gradually shifting towards a decentralized model as consumers change. Citigroup lowered its target price for Alibaba from HK$297 to HK$288 while maintaining its buy rating, believing the company can once again demonstrate that its operating experience can help it cope with the impact of a tightening regulatory environment and slowing industry growth.The bank pointed out that the performance indicators of the new investment mainly lie in users, order growth, user experience and delivery rate. The progress in community group buying is also steady. The GMV and GFA (distribution center floor area) of the community commerce platform increased by 200% and 260% respectively quarter-on-quarter, while the orders of Ele.me and Lazada increased by more than 50% and 90% year-on-year respectively. The management pointed out that its investment strategy has shifted from a single application to a multi-app strategy, and it hopes to gradually increase its user base and revenue through the new App.
In addition, management welcomes potential cross-platform openness and strengthened connectivity, believing it will have a positive effect on reducing merchant operating costs and improving user experience. Alibaba reiterated that the company complies with mainland privacy regulations and will not use data or calculations to maximize advertising monetization.
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