Alibaba: worth the risk?

Anselo
2022-03-08

No:

1) Nobody knows how China's regulatory clam down will continue and in what manner and extent. Recently, chinese regulators says self-inspection within Ant "almost done," but that issues remained to be investigated, without elaborating. This is as good as saying we might hit them further. Plus rumours of additional checks and recent clam down on Alibaba’s food delivery app Ele.me points to further pain going forward.

2) Don't downplay the effects of Jack Ma's comments and China's regulatory clam down in response as the end of story. Making a multi-billion company fail may be the message the authorities want to send out for would-be dissenters. Although I believe they are too big to fail, never say never…..

3) China's new data regulations may blunt Alibaba's data monopoly, and data is money for tech companies.

Yes:

1) Revenue growth has slowed but slowing growth is still growth.

2) Cloud business might be their next big thing to be profit generating in years to come.

3) They are funding their loss-making companies with profits from e-commerce, if the other portfolio companies take off, there are potential gains to be made.

4) Attractive valuations at below 100 HKD for a profitable company (provided the regulators don't kill them off) 

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Comments

  • moonzo
    2022-03-08
    moonzo
    In my heart, Alibaba has always been an excellent company. I am optimistic about its development in the past, now and in the future.
  • IN76
    2022-03-13
    IN76
    I dont think China will wipe out Alibaba as it has establised itself as a global company. China just eants to flex its muscle to snub Jack Ma’s snobbishness.
  • ElvisMarner
    2022-03-11
    ElvisMarner
    Let's be honest, Alibaba is absolutely undervalued.
  • MR_Wu
    2022-03-11
    MR_Wu
    Alibaba's cloud business is a new growth point for its performance.
  • PandoraHaggai
    2022-03-11
    PandoraHaggai
    No one knows what the future fate of Alibaba will be.
  • LouisLowell
    2022-03-11
    LouisLowell
    I still think Alibaba can reach 60.
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