> **来源：[研报客](https://pc.yanbaoke.cn)** # Alibaba (BABA US) Summary ## Core Content Alibaba Group reported strong performance in its cloud business during the fourth quarter of fiscal year 2026 (4QFY26), with revenue growing by 38% YoY. This growth is attributed to increasing adoption of AI-related products and services, which now account for 30% of external cloud revenue, with an annual run rate of RMB35.8bn. Management anticipates AI-related revenue to surpass 50% of external cloud revenue by FY27, positioning the cloud business as a key growth driver. The cloud business also saw an improvement in adjusted EBITA margin to 9.1% in 4QFY26, up 1.1 percentage points YoY, and is expected to further improve in the first half of FY27. The quick commerce (QC) business is showing signs of improvement, with management forecasting that its unit economics (UE) could turn positive in certain months within FY27. The total QC losses are projected to narrow to RMB44bn in FY27E, then halve in FY28E, and eventually reach breakeven in FY29E. This improvement is expected to provide more room for Alibaba to invest in AI business deployment. The overall revenue for FY26 grew by 3% YoY, while adjusted EBITA declined by 56% YoY, primarily due to investments in technology and user experience. However, the outlook for the cloud business remains positive, with potential for margin expansion and valuation rerating. ## Key Business Segments - **Alibaba China E-commerce Group (ACEG)**: Accounted for 46.2% of 4QFY26 revenue, RMB122.2bn, up 6% YoY. The segment's adjusted EBITA declined 40% YoY due to QC investments, but conventional e-commerce EBITA remained stable. QC revenue grew by 1% YoY, with improvements in UE and average order value (AOV). - **Alibaba International Digital Commerce Group (AIDC)**: Generated RMB35.4bn in 4QFY26, up 6% YoY. International commerce retail revenue increased by 5% YoY, while wholesale revenue rose by 9% YoY. The segment recorded an improved adjusted EBITA, with a loss of RMB138mn in 4QFY26 compared to RMB3.6bn in 4QFY25, due to enhanced operating efficiency in AliExpress and other international businesses. - **Cloud Intelligence Group (CIG)**: Delivered RMB41.6bn in revenue in 4QFY26, up 38% YoY. Excluding Alibaba-consolidated subsidiaries, cloud revenue increased by 40% YoY. CIG's adjusted EBITA margin improved to 9.1%, up from 8.0% in 4QFY25. Management expects a notable sequential improvement in the cloud margin profile in 1HFY27 and reiterated its medium- to long-term target of a 20% adjusted EBITA margin for CIG. - **All Others**: Revenue was RMB45.5bn in 4QFY26, down 21% YoY, primarily due to the disposal of Sun Art and Intime, and lower revenue from Cainiao. The segment's adjusted EBITA was a loss of RMB21.2bn in 4QFY26, up from RMB3.4bn in 4QFY25, due to increased investment in technology businesses. ## Valuation and Forecast - **Target Price**: US$220.10 per ADS, up from US$206.10, implying a 23x FY28E non-GAAP P/E. - **Forecast Revision**: The analyst trimmed FY27E and FY28E revenue forecasts by 1% each due to the change in accounting treatment and lower revenue forecasts for the Direct Sales, Logistics, and Others segment. - **SOTP Valuation**: The SOTP valuation was raised by 7% to US$220.1 per ADS, with the valuation base rolled forward to FY27E. The components of the valuation are: - ACEG: US$93.1 per ADS - AIDC: US$14.1 per ADS - CIG: US$85.6 per ADS - All Others: US$16.2 per ADS - Strategic investments: US$11.2 per ADS ## Financial Summary - **Revenue**: Expected to grow by 9% in FY27E and 10.9% in FY28E. - **Adjusted Net Profit**: Projected to increase from RMB98.2bn in FY27E to RMB198.7bn in FY29E. - **Gross Margin**: Expected to remain stable at 39.8% for FY27E and FY28E, but may improve in FY29E. - **Non-GAAP Net Margin**: Projected to increase from 8.8% in FY27E to 14.4% in FY29E. - **Operating Profit**: Expected to grow significantly, with projections of RMB73.3bn in FY27E and RMB201.8bn in FY29E. - **Net Profit**: Projected to increase from RMB77.6bn in FY27E to RMB176.1bn in FY29E. - **Adjusted Net Profit**: Projected to grow from RMB98.2bn in FY27E to RMB198.7bn in FY29E. ## Risks - **Margin Impact**: Investments for business growth may have a more severe impact on margins than expected. - **Consumption Recovery**: The pace of consumption recovery may be slower than anticipated. ## Analyst Ratings - **BUY**: The stock is expected to deliver a return of over 15% over the next 12 months. - **HOLD**: The stock is expected to deliver a return of +15% to -10% over the next 12 months. - **SELL**: The stock is expected to result in a loss of over 10% over the next 12 months. - **NOT RATED**: The stock is not rated by CMBIGM. - **OUTPERFORM**: The industry is expected to outperform the relevant broad market benchmark. - **MARKET-PERFORM**: The industry is expected to perform in-line with the relevant broad market benchmark. - **UNDERPERFORM**: The industry is expected to underperform the relevant broad market benchmark. ## Shareholding and Performance - **Shareholding Structure**: JPMorgan holds 2.3%, and Parufam Limited holds 0.8%. - **Share Performance**: - 1-month: +11.0% - 3-months: -6.4% - 6-months: -5.2% - **12-month Price Performance**: A chart is provided to show the price performance of BABA US against IXIC (Rebased). ## Analysts - **Saiyi HE, CFA** - **Ye TAO, CFA** - **Wentao LU, CFA** - **Shuyin GUO** ## Market Data - **Mkt Cap (US$ mn)**: 350,581.9 - **Avg 3 mths t/o (US$ mn)**: 730.2 - **52w High/Low (US$)**: 189.34/103.83 - **Total Issued Shares (mn)**: 2404.4 ## Financial Ratios - **P/E (x)**: 31.3 in 2024A, 18.0 in 2025A, 21.7 in 2026A, 29.3 in 2027E, 17.2 in 2028E, 12.7 in 2029E - **P/E (diluted)**: 31.6 in 2024A, 18.5 in 2025A, 22.5 in 2026A, 30.4 in 2027E, 17.9 in 2028E, 13.1 in 2029E - **P/B**: 2.5 in 2024A, 2.3 in 2025A, 2.2 in 2026A, 1.9 in 2027E, 1.7 in 2028E, 1.4 in 2029E - **P/CFPS**: 16.7 in 2024A, 30.8 in 2025A, 72.9 in 2026A, 13.1 in 2027E, 23.1 in 2028E, 16.5 in 2029E ## Disclosure This report is prepared by CMB International Global Markets Limited, a wholly owned subsidiary of CMB International Capital Corporation Limited, which is itself a wholly owned subsidiary of China Merchants Bank. It is not intended to provide individually tailored investment advice. Investors are advised to consult with a professional financial advisor before making investment decisions.