Alibaba's new move? A brand new group buying product may be launched, directly targeting Meituan's core business

On the morning of September 9, the market suddenly reported that Alibaba would officially announce the launch of a new group buying product and evaluation system in the next two days, directly competing with Meituan's core business. According to a reporter from Securities China, there will indeed be a significant business launch conference at Alibaba's West Xixi C District in Hangzhou on Wednesday morning (September 10), with the event scheduled for half a day in the morning. However, Alibaba did not specify whether it was a group buying business launch conference.

On the evening of September 8, Alibaba's stock price surged over 4% in the U.S. market. This morning, Alibaba's stock price in Hong Kong also performed well. Yesterday, there was a net inflow of HKD 5.146 billion into Alibaba through the Hong Kong Stock Connect. Haitong International stated that Alibaba's instant retail business is showing strong momentum, with Ele.me and Flash Purchase continuously gaining market share, as well as accelerated growth in cloud business revenue, confirming the resilience of domestic cloud market demand, which is expected to jointly support revenue and long-term profit margin improvement; the target price for U.S. stocks has been raised to USD 167 per share, with a rating of "Outperform."

Alibaba's Major Announcement

Early Tuesday morning, the market was abuzz with a piece of news. There are rumors that Alibaba will officially announce the launch of a new group buying product and evaluation system in the next two days, directly competing with Meituan's core business. The new battlefield, which has been brewing for months, is about to fully kick off, and the local life service industry landscape may undergo significant changes.

Following Alibaba's surge in U.S. stocks last night, the Hong Kong stock performance this morning was also good.

In contrast, Meituan's performance has been lackluster. Recently, the stock has also been in continuous decline.

So, is the rumor about the group buying business true? A reporter from Securities China learned that there will indeed be a significant business launch conference at Alibaba's West Xixi C District in Hangzhou on Wednesday morning (September 10), with the event scheduled for half a day in the morning. However, Alibaba did not specify whether it was a group buying business launch conference.

Haitong International's research report pointed out that Alibaba's total revenue for the quarter ending in June reached RMB 247.7 billion, a year-on-year increase of 2%, with an operating profit of RMB 34.99 billion, a year-on-year decrease of 3%. Adjusted EBITA fell 14% year-on-year to RMB 38.8 billion, mainly due to investments in the Taotian Flash Purchase business, user acquisition expenses, and technology research and development investments. The net profit attributable to shareholders increased significantly by 76% year-on-year to RMB 43.1 billion, mainly from investment fair value gains and the disposal of Trendyol's local service business The institution believes that the group's instant retail business is gaining strong momentum, with Ele.me and Flash Purchase continuously gaining market share, as well as accelerated growth in cloud business revenue, confirming the resilience of domestic cloud market demand, which is expected to jointly support revenue and long-term profit margin improvement; the target price for US stocks has been raised to $167, with a rating of "Outperform." As of yesterday's close, the US stock price was $141.2 per share.

Alibaba Cloud Also Has Big News

According to the latest news, Omdia released the report "China AI Cloud Market, 1H25," which shows that in the first half of 2025, the scale of China's AI cloud market will reach 22.3 billion yuan, with Alibaba Cloud accounting for 35.8%, ranking first, with a market share higher than the total of the second to fourth places, continuing to lead market development with "AI Full Stack." The report believes that generative AI (GenAI) will lead to an explosion in the AI cloud market, with an expected growth of 148% by 2025, reaching a scale of 193 billion yuan by 2030.

Some brokerage research believes that Alibaba's Flash Purchase business has exceeded expectations, and future internal efforts are expected to stabilize: since Alibaba significantly invested in the Taobao Flash Purchase business in May, the overall order volume has continued to increase, reaching a level close to Meituan. After reaching a certain order volume, user experience (UE) will also change, and the gap with Meituan is expected to narrow, with the proportion of high Average Order Value (AOV) orders also increasing, leading to a significant improvement in overall efficiency. The company will also increase investment in rider path systems, flash warehouses, and supply chains to consolidate and maintain market share in the Flash Purchase business.

The Flash Purchase business is expected to drive user activity on the main site and increase CMR: The company has seen the synergy effects of instant retail from the recent growth in GMV, and does not rule out the possibility of launching a super APP in the future to create a large consumption platform that integrates various businesses and achieves mutual traffic. In addition, the instant retail business itself is expected to reach a GMV level of 1 trillion yuan in the next three years, which will qualitatively enhance overall advertising revenue and user activity on the main site.

Demand for Alibaba Cloud continues to rise, with optimism about future cloud business growth and CAPEX increase: The sustained outperformance in cloud business revenue growth is mainly due to the chain effect driven by AI. The company's enhancement of large model capabilities based on AI direction, customer service, and large databases has completed large model enhancements or product restructuring. In the future, the cloud will be restructured by large models, and the entire cloud system will no longer have traditional SaaS or PaaS, possibly only existing as MaaS and Agent services. The characteristics and new capabilities of all products will be realized through large models, requiring only updates to model capabilities, which poses challenges for all cloud vendors. The closed-source nature of technology will further highlight Alibaba's technological differentiation, thereby maintaining high gross margins and high revenue.

Due to the continuously exceeding expectations of Flash Purchase business data, the future Flash Purchase business will also feed back to the main site, driving user activity and growth in advertising CMR business on the main site; Alibaba Cloud benefits from the chain effects brought by AI restructuring of cloud business, and the barriers to cloud business will also increase in the future, with cloud business growth and CAPEX increase expected to maintain a growth trend. We remain optimistic about Alibaba's future performance Author of this article: Yingchao, Shiqian, Source: Securities China, Original title: "Alibaba, Breaking News!"

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