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<Research>G Sachs Lifts BABA-W's TP to HKD174, Upbeat About Cloud AI-Driven Growth Compounding Potential
Recommend 65 Positive 118 Negative 45 |
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Goldman Sachs has issued a research report highlighting several major developments in China's AI infrastructure, models, and applications since its last monthly report. Specifically, multiple new AI models were launched in China, including Alibaba's Qwen3-Next, BIDU-SW's (09888.HK) (BIDU.US) X1.1, and TENCENT (00700.HK) (TCEHY.US)'s HYWorld-Voyager 3D. Trading platforms also introduced AI assistants, such as Alibaba's Amap 2025 and MEITUAN-W (03690.HK)'s Xiao Mei. Goldman Sachs has raised Alibaba's cloud valuation from USD36 to USD43 per ADS, based on assumptions of its cloud growth in 2Q-4QFY26 increased from YoY growth of 28-30% to 30-32%. Accordingly, Alibaba's SOTP (sum-of-the-parts) 12-month target price has been raised from USD163 to USD179 for its US shares. The target price for its H-shares has also been lifted from HKD158 to HKD174. Both have their Buy ratings kept unchanged. Goldman Sachs believes that the multi-chip strategy of China's cloud hyperscale enterprises has updated the narrative of China's AI cloud industry (no longer solely reliant on overseas chip supplies), bringing growth compounding potential to the industry and shoring up the recent upgrade in preference for the cloud and data center sub-sectors. AAStocks Financial News |
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