Nomura Increases Alibaba (BABA.US) Price Target to USD 237; T-Head IPO Could Reveal Hidden Value
Nomura's Research on Alibaba: Nomura released a report indicating that Alibaba's potential separate listing of its chip business, T-Head, could unlock significant value, especially as US-China relations stabilize and T-Head expands its customer base.
Valuation Insights: The report values Alibaba Cloud and T-Head at approximately USD 390 billion, while also noting that Baidu's AI cloud business is valued at USD 63 billion, highlighting the competitive landscape in the tech sector.
Stock Performance: Alibaba's stock (BABA-W) saw a rise of 2.179%, with a short selling ratio of 8.823%, while Baidu's stock (BIDU-SW) experienced a slight decline with a higher short selling ratio of 35.444%.
Investment Rating: Nomura maintained a Buy rating for Alibaba, raising the target price from USD 193 to USD 237, reflecting confidence in the company's growth prospects.
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BLACK SESAME Partners with Apollo Go to Create Autonomous Driving Ecosystem
Stock Performance: BLACK SESAME (02533.HK) and BIDU-SW (09888.HK) experienced slight declines in their stock prices, with short selling activity reported for both companies.
Strategic Cooperation: BLACK SESAME and Baidu's Apollo Go have entered a strategic partnership to develop an autonomous driving ecosystem aimed at enhancing China's intelligent driving industry.
Focus on Industry Chain: The collaboration will leverage both companies' technological and operational strengths to accelerate the development of the L4 autonomous driving industry chain.
Analyst Outlook: Citi maintains a "Buy" rating on Baidu (BIDU.US), citing its comprehensive technology capabilities in the sector.
Citi Identifies TENCENT as Top Beneficiary of China's Approval for H200 Chip Acquisitions
Regulatory Approval: Chinese regulators have approved the procurement of Nvidia H200 AI chips by tech giants Alibaba, Tencent, and ByteDance, which could positively impact the Chinese internet industry.
Beneficiary Insights: Citi's report indicates that Tencent is expected to be the biggest beneficiary of this approval, as it may leverage GPU computing power leasing amid potential procurement restrictions.
Investment Risks: The report also cautions about the risk of increased capital expenditure for these companies in 2026, which could affect their financial strategies.
Citi's AI Industry Preference: Citi has ranked its preferences in the AI sector as Tencent > Alibaba > Baidu, reflecting their outlook on the companies' potential in the evolving market.
