BABA: Positive On 2023 Outlook On China’s Full Reopening And Government’s Economic Priority; Expect Upside Surprises Throughout 2023
We are positive on BABA’s CY2023 outlook. After multiple ups and downs in CY2022, CY2023 can be a much better year for China e-commerce companies due to: 1) China is giving up its zero-COVID policy, and the country is fully opening; 2) resetting economic development as the nation’s top priority; and 3) the whole year of 2022 sets a low base for 2023. Specifically for BABA, it is political risk-free now, in our view. As the economic recovery post-COVID has become the priority for the Chinese government, the political/policy pressure on BABA has been lifted. The symbolic event is that the government has finished its restructuring of Ant Finance. For FY3Q23, we do not expect upside surprises on topline growth given the rapid outbreak of COVID in December, while we are positive for the whole year of 2023.
T.H. Capital is an independent research and investment advisory firm specializing in China. We offers real-time, on-the-ground, bottom-up research across a wide spectrum from macro and industry analysis to company specific projects; from China ADRs to international names that have meaningful exposure to China market. We deliver relevant, comprehensive and data driven research adding immense value to clients.
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