Alibaba loses speed

Alibaba revenue "only" grew 34 percent to €26.8 billion in Q2 2021, compared with 64 percent growth a year earlier (albeit with a Corona effect). Alibaba is struggling in its home market with strong competition from JD.com and Pinduoduo, which are taking share away from the market leader. However, its overseas business is getting off to a better start.

The stock's plunge, however, is largely due to China's regulatory crackdown on large digital companies. The stock has lost about 36 percent since its all-time high last October. Alibaba's financial holding Ant Group is also suffering from regulation. Between April and June, Ant Group contributed 585 million euros, a good third less to the group's earnings than a year earlier.

We continue to consider Alibaba a highly interesting platform, but are currently not invested due to the regulatory uncertainties in China. We remain in watch mode.

The author and/or related persons or companies may own the shares mentioned herein or are already invested in these shares, e.g. via an investment vehicle. This article is for general information purposes only and constitutes a free expression of opinion and not investment advice. Please also note the detailed legal information.

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