CITIC Securities issued a research report applying a sum-of-the-parts valuation method. It assigned Alibaba-W (09988, BABA.US) a 10x P/EBITA multiple for its FY2027 e-commerce business, zero valuation for on-demand retail, 5x PS for cloud computing, and 1x PS for international e-commerce. This translates to a target price of US$206/ADR for its US shares and HK$201 per share for Hong Kong-listed shares, implying a FY2027 Non-GAAP PE of 24x for the group. The firm maintains its "Buy" rating.

The report highlights that Alibaba's cloud revenue outperformed market expectations, while narrowing losses in on-demand retail met projections—factors expected to drive medium-to-long-term stock appreciation. On the consumption platform front, Taotian Group's CMR revenue grew 10% YoY in FY2026Q2, with EBITA achieving mid-single-digit growth after excluding on-demand retail losses. The on-demand retail business has shifted from scale expansion to efficiency optimization, with unit economics losses meeting expectations while demonstrating significant synergy effects that positively impact CMR.

Regarding AI, FY2026Q2 capital expenditures (CN¥31.5 billion) and cloud revenue (+34%) continued the strong performance seen in Q2, exceeding market expectations. Internal revenue grew rapidly, with AI-related revenue surging triple digits YoY and accounting for over 20% of total. Alibaba Cloud will maintain its "one cloud, multiple chips" strategy to meet robust AI client demand, with CITIC anticipating continued acceleration in cloud business revenue growth.