Alibaba Group Holdings
START - $117 | FINISH - $149
- HORIZON: 3 months (Short-Term)
- FROM: 23 April 2025 | UNTIL: 23 July 2025
- MANAGEMENT ASSESSMENT: 25% growth
- RECOMMENDATION: BUY
TRADING PLAN
● Entry: Enter at or near $116.70 per share.
● Stop Loss: Set the stop loss at $95 to manage potential downside risk.
● Target: $145.88 by the end of the investment horizon, reflecting an expected 25% upside from the current price.
WHY THESE SHARES HAVE POTENTIAL FOR PROFIT
● Exposure to China’s e‑Commerce and AI Boom: Alibaba provides investors a gateway to China’s rapidly expanding digital economy through its dominant Taobao and Tmall platforms, which serve over 900 million active users. As China’s e-commerce market surpasses $2.1 trillion, Alibaba is also investing $53 billion into AI and cloud infrastructure, embedding AI across its services, from personalised shopping and logistics to automated customer support, positioning the company for sustained growth in online retail and emerging AI technologies.
● Benefit from China’s Economic Stimulus: China’s 2025 stimulus package includes a record ¥3 trillion in special treasury bonds, a higher budget deficit of 4% of GDP, and ¥300 billion in consumer goods subsidies aimed at boosting household spending. In addition, the central bank implemented a 0.50% cut in reserve requirements and lending rates to support credit and consumption. These measures helped retail sales grow by 5.9% year-on-year in March 2025, with much of the rebound flowing into online platforms like Taobao, Tmall, and AliExpress, directly benefitting Alibaba’s core e-commerce business.
● Strong Financial Performance: In Q4 2024, Alibaba reported ¥280.2 billion revenue, up 8% year-on-year, and ¥48.9 billion net income, its strongest profit in over a year. The company’s Cloud Intelligence Group grew 13% year-on-year to ¥31.7 billion. International retail commerce revenue increased 32%, while domestic e-commerce increased 5%.
INDICATORS
Alibaba’s share price is showing a strong uptrend, forming higher highs and higher lows, a classic sign of upward momentum. It is currently trading above its 200-day simple moving average (SMA), a key long-term indicator of strength, after successfully bouncing off this dynamic support level, which has historically led to further gains. Additionally, momentum indicators are turning bullish, with many still near oversold territory, suggesting the stock could be gearing up for another potential leg higher as buying interest returns.
RISKS
● Political Risk: Geopolitical tensions between China and the US pose risks to its US listing and may limit access to global capital markets, adding volatility and potential downside for international investors.
● Slowing Domestic Growth: Consumer prices fell 0.1% in March, and industrial profits declined in January and February. Exports face volatility from new US tariffs, and GDP growth is forecast to slow to 4.5% in 2025. Global banks have cut China's growth forecasts due to trade tensions, and the IMF warns of a broader global trade slump. Meanwhile, Russia’s slowing growth is already curbing Chinese exports.
Disclaimer:
*Any opinions, views, analysis or other information provided in this article is provided by BCS Markets SA trading as BROKSTOCK as general market commentary and should not be viewed as advice according to the FAIS Act of 2002. BCS Markets SA does not warrant the correctness, accuracy, timeliness, reliability or completeness of any information provided by third parties. You must rely upon your judgement in all aspects of your investment decisions and all decisions are made at your own risk. BCS Markets SA and any of its employees shall not be responsible for and will not accept any liability for any direct or indirect loss including without limitation any loss of profit which may arise directly or indirectly from use of the market commentary. The content contained within the article is subject to change at any time without notice. BCS Markets SA is an authorised financial services provider FSP No. 51404.
** This article was prepared by BROKSTOCK analyst Maboko Seabi
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