ALIBABA(BABA.US)：2021 INVESTOR DAY TAKEAWAYS

BABA held 2021 Investor Day on Dec 16-17, reiterated its strategic initiatives in China consumption, Globalization and Technology
Although eC faced challenges, overseas eC and cloud biz are strong engines to balance lacklustre eC segment
TP unchanged; Near term headwinds to drag share performance
　　Consumption focus on user growth, wallet share and value creation
　　BABA held its 2021 Investor Day on Dec 16-17. Managements reiterated BABA’s strategies in China consumption, Globalization and Technology, as well as emphasized on building core capabilities to create long term values.China consumption: 1) User growth: Utilize comprehensive product offerings and upgraded consumption experience to meet diversified demands from various consumer segments (ie. Taobao Deals and Taocaicai to capture mindshare of lower tier market consumers that are price-sensitive); 2) Increase wallet share: Expand supply and upgrade services to drive online penetration in high-potential product categories (ie. second-hand products, travel, home products, food, grocery and fresh produce); and 3) Value creation: Leveraging strong infrastructure capabilities in supply chain, fulfilment, delivery to create long term values for consumers. In general, we believe BABA should be able to fend off competition and maintain leadership position by leveraging its strong consumer mindshare and reinforcing infrastructure capabilities.
　　Strong engines to balance lackluster eC segment
　　Globalization: 1) Utilize multi-brands strategy to serve international consumers and merchants (ie. Lazada to target SEA markets, AliExpress to focus EMEA markets); 2) SEA/EMEA have low eC penetration merely at 11%/12% respectively, still have large potentials; 3) Reinforce global eC infrastructure in smart logistics, digital payments and cloud etc. In 1HFY22, BABA’s international commerce has received strong rev growth at 41% yoy vs. China commerce’s 33% yoy rev growth. Technology: 1) Invest in cutting-edge technologies especially in cloud, data and AI; 2) Capture China’s digitalization trend to provide industry solutions leveraging capabilities in cloud and industry knowhow. We believe these multi-growth engines should help BABA to alleviate near term struggles in eC segment.
　　Remain on the side-line in the near term
　　Besides these strategies, BABA is also well-positioned to capture future opportunities in green economy, silver economy and rural revitalization. In the near term, we still remain on the sideline amid ongoing macro and regulatory headwinds. We maintain BUY with TP at USD226 unchanged.Our TP implies 25x FY23E P/E. Key risks: Tightening regulation in community group purchase segment, intensifying competition on merchant acquisition, slower than expected expansion in international eC.
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   【免责声明】本文仅代表第三方观点，不代表和讯网立场。投资者据此操作，风险请自担。