Company Report: Alibaba Group (BABA US) Ray Zhao 赵 睿 公司报告：阿里巴巴集团 (BABA US) +86 755 23976755 [email protected] 国泰君安研究 11 May 2015 FY15 FCF RMB48.1bn, Tremendous Hidden Value, ‘Buy’ FY15自由现金流RMB481亿，巨大隐藏价值，“买入” TJA Research TJA G Alibaba Group announced 4QFY15 results, slightly above market Rating: Buy expectation. GMV reached RMB600bn, up 40% yoy, with mobile GMV of Maintained RMB304bn, up 158% yoy, 50.6% of total GMV. Revenue reached 评级： 买入 (维持) RMB17,425mn, up 44.8% yoy, 3.6% above consensus forecast. Mobile revenue reached RMB5,247mn, up 351.5% yoy. Net profit reached RMB2,893mn, down 48.4% yoy, 10% below market expectation. Non GAAP 6-18m TP 目标价: US$110.00 原目标价 net profit reached RMB7,741mn, up 16.0% yoy, 15.6% above market Revised from : US$110.00 consensus. FY15 Free Cash Flow reached an amazing level of 价： ADS US$87.060 RMB48,121mn, up 49.1% yoy. Key points: 1) Robust Tmall GMV growth above expectation. Tmall GMV reached RMB219bn, up 62.2%, up 1.1ppt qoq. 2) State Council Stock performance 股价表现 announced favorable policies for small & micro ecommerce including 80 tax reduction and more credit support, benefiting Taobao. 3) New % change businesses grew fast. New businesses mainly include Ant Financial, 65 Aliyun, Alibaba Pictures and Alibaba Health. Maintain Target Price at USD110.00 with ‘Buy’ investment rating. We 50 think Alibaba’s new businesses grew very fast and might come into the 35 valuation. FCF might exceed RMB1,00bn in 2 years. Our FY16-18 Non GAAP net profit estimates are RMB41.9bn, RMB53.6bn and RMB61.2bn, 20 respectively. Our TP USD110.00 represents 33.9x FY17 Non GAAP PE. 5 ） 阿里巴巴公布了 财年业绩，略好于预期。 达到 亿，同比增长 US 4QFY15 GMV RMB6,000 (10) 40%，其中移动 GMV 达到 RMB3,040 亿，同比增长 158%，占到总 GMV50.6%。收入 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Apr-15 May-15 NASDAQ CCMP Index Alibaba Group 达到 RMB174.25 亿，同比增长 44.8%，超出市场预期 3.6%。其中移动端零售电商收入 BABA （ 达到 RMB52.47 亿，同比增长 351.5%。净利润达到 RMB28.93 亿，同比下降 48.4%， 低于市场预期 10%。Non GAAP 净利润达到 RMB77.41 亿，同比增长 16.0%，高出市场 预期 15.6%。FY15 年自由现金流达到 RMB481.21 亿的惊人水平，同比增长 49.1%。 Change in ADR Price 1 M 3 M 1 Y 要点：1）天猫增速高于预期。天猫 GMV 达到 RMB2,190 亿，同比增长 62.2%, 季环比 ADR 变动 1 个月 3 个月 1 年 上升 1.1ppt。2）国务院出台小微电商鼓励政策。鼓励政策包括减少税收，增加贷款支持 Abs. % 阿里巴巴集团 2.9 1.2 n.a. 绝对变动 % 等, 利好淘宝电商。3）公司新业务增长非常快。新业务包括蚂蚁金融，阿里云，阿里影 Rel. % to NASDAQ index 2.3 (1.1) n.a. 业，和阿里健康等。 相对纳指变动 % Avg. ADR price(US$) 维持目标价 USD110.00, 投资评级为“买入”。我们认为公司新业务发展非常快，会逐 83.3 84.1 n.a 平均 ADR 价（美元） 渐进入估值。公司自由现金流 2 年内会超过 RMB1,000 亿。我们 FY16-18 年 Non GAAP Source: Bloomberg, Guotai Junan International. Alibaba Group 净利润预测是 RMB419 亿， RMB536 亿，和 RMB612 亿。目标价 110.00 美元，相当于 33.9 倍的 Non GAAP FY17 市盈率。 Mar End Turnover Net Profit Earnings /ADS Earnings /ADS PER BV/ADS PBR DP/ADS Yield ROE 年结 收入 股东净利 每 ADS 净利 每 ADS 净利变动 市盈率 每 ADS 净资产 市净率 每股股息 股息率 净资产收益率 3/31 (RMB m) (RMB m) (RMB) (△%) (x) (RMB) (x) (RMB) (%) (%) 2014A 52,504 23,076 10.610 189.9 50.9 13.985 38.6 0.000 0.0 149.2 2015A 76,204 24,149 10.330 (2.6) 52.3 67.335 8.0 0.000 0.0 25.7 2016F 106,909 26,413 10.235 (0.9) 52.7 71.287 7.6 0.000 0.0 15.5 2017F 152,109 36,347 13.675 33.6 39.5 82.955 6.5 0.000 0.0 18.0 2018F 196,381 43,055 15.726 15.0 34.3 96.347 5.6 0.000 0.0 23.9 Share in issue (m) 总股数 (m) 2,452.0 Major shareholder 大股东 SoftBank 31.9% Market cap. (US$ m) 市值 (US$ m) 213,445 Free float (%) 自由流通比率 (%) 17.5 3 month average vol. 3 个月平均成交股数 (‘000) 17,197.9 FY16 Net gearing FY16 净负债/股东资金 (%) Net cash 52 Weeks high/low (US$) 52 周高/低 120.000 / 77.770 FY15-17 PEG FY15-17 市盈率相对盈利增长比率 2.2 Source: the Company, Guotai Junan International. Report Company See the last page for disclaimer Page 1 of 12 Alibaba Group announced 4QFY15 results, slightly above market expectation. GMV reached RMB600bn, up 40% yoy, with mobile GMV of RMB304bn, up 158% yoy, 50.6% of total GMV. Revenue reached RMB17,425mn, up 44.8% yoy, 3.6% above market consensus. Mobile revenue reached RMB5247mn, up 351.5%. Net profit reached RMB2,893mn, down 48.4% yoy, 10% below consensus, and non GAAP net profit reached RMB8,144mn, up 77.7% yoy, 15.6% above market consensus. Table 1: Alibaba Group’s Results Compared to Our Expectations Our Expectation 1Q15 Actual 1Q15 Explanation Income Statement 11 May 2015 Revenues mn RMB 18,359 17,425 -5.1% 3.6% higher than Bloomberg consensus Cost of Revenues mn RMB (5,825) (6,133) 5.3% Gross Profit mn RMB 12,535 11,292 -9.9% Sales and Marketing Expenses mn RMB (1,836) (3,042) 65.7% Stock-based expenses reached RMB4.6bn far above expectations General and Administrative Expenses mn RMB (1,652) (2,531) 53.2% Product Development Expenses mn RMB (2,020) (2,477) 22.7% Yahoo Tipla Amendment Payment mn RMB 0 0 Amortization of Intangible Assets mn RMB (554) (643) 16.1% Operating Profit mn RMB 6,473 2,599 -59.8% Far below expectations due to higher than expected Stock-based expenses Interest Expense mn RMB (1,455) (475) -67.4% Interest and Investment Income/(Loss), Net mn RMB 214 1,846 761.8% More interest revenue from cash at hands and the sale of SME loans Other Income, Net mn RMB 1,142 496 -56.6% Less than expected revenue from Ant financial Impairment of Goodwill, intangible Assets mn RMB 0 0 Provision for Income Tax mn RMB (1,594) (1,203) -24.5% Share of Results of Equity Investees mn RMB (127) (394) 209.0% Minority Interest (After Tax) mn RMB (25) 24 -194.1% Net Income (Loss) mn RMB 4,628 2,893 -37.5% 10% lower than Bloomberg consensus Dividends on Preferred Stock 0 0 Preferred Stock Adjustments 0 0 Net Income Available to Common Shareholders mn RMB 4,628 2,893 -37.5% China Retail GMV bn RMB 636 600 -5.6% Desktop bn RMB 353 296 -16.1% Mobile bn RMB 283 304 7.3% Mobile GMV accounted for around 51% of total GMV, record high Taobao marketplace bn RMB 420 381 -9.3% Hurt by cracking down counterfeit trade ） Tmall bn RMB 216 219 1.4% Tmall GMV growth as above expectations to 62%, flat QoQ US Retail Ecommerce Revenue mn RMB 14,198 13,049 -8.1% Desktop mn RMB 8,815 7,802 -11.5% BABA BABA Mobile mn RMB 5,383 5,247 -2.5% （ Monetization Rate of retail GMV % 2.23% 2.17% Weaker than expected monetization rate Desktop Monetization Rate on Desktop Retail GMV % 2.50% 2.64% Mobile Monetization on Desktop Retail GMV % 1.90% 1.73% 阿里巴巴集团 Expenses Ratio % 33.0% 49.9% Higher than expected Stock-based expenses Sales and Marketing Expenses % 10.0% 17.5% General and Administrative Expenses % 9.0% 14.5% Product Development Expenses % 11.0% 14.2% Amortization of Intangible Assets % 3.0% 3.7% Alibaba Group Non GAAP Non GAAP EBITDA mn RMB 9,835 8,583 -12.7% Slightly below our expectations but 15.6% higher than Bloomberg consensus Non GAAP net profit mn RMB 7,417 7,741 4.4% Growth% Non GAAP operating profit % 42.8% 36.0% Non GAAP net profit % 61.8% 53.9% Revenue China Commerce mn RMB 15,029 13,895 -7.5% Retail mn RMB 14,198 13,049 -8.1% Wholesale mn RMB 832 846 1.7% International Commerce mn RMB 1,781 1,637 -8.1% Retail mn RMB 570 437 -23.3% It's very difficult to build up B2C export business. Wholesale mn RMB 1,211 1,200 -0.9% Cloud Computing and Internet Infrastructure mn RMB 320 388 21.4% Much faster than expected. Aliyun has great upside potential. Others mn RMB 1,230 1,505 22.4% UCWeb and AutoNavi grew faster than expected. Total mn RMB 18,359 17,425 -5.1% Source: the Company, Guotai Junan International. Report Company See the last page for disclaimer Page 2 of 12 Very strong non GAAP profit indicators and cash flows. 1) High stock-based compensation might be only temporary. In 4QFY15, Alibaba Group’s non GAAP profit reached RMB7,741mn, up 16.0% yoy. Non GAAP EBITDA reached RMB8,583mn, up 24.6% yoy. Alibaba Group’s non GAAP profit was much higher than GAAP profit, due to very high stock-based compensation, reaching RMB4.6bn in 4QFY15, up 400.7% yoy. This was a big concern. However, Alibaba Group has many new businesses, such as UCWeb, AutoNavi, PP Assistant, and Ant Financial. We think it was reasonable for Alibaba Group to give more stock-based compensation to stimulate the new teams engaged in new businesses. 2) Very strong free cash flow (FCF). Alibaba Group’s 4QFY15 FCF reached RMB5,665mn, up 142.8% yoy. Total FCF in FY15 11 May 2015 reached an amazing level of RMB48,121mn, up 49.1% yoy, indicating that Alibaba Group could invest RMB30.0bn~RMB40.0bn to acquire new strategic assets.