To The Moon

🌟🌟🌟Alibaba $BABA-W(09988)$  $Alibaba HK SDR 5to1(HBBD.SI)$  $Alibaba(BABA)$  is up 14% in the HK market in the past 5 days, 8.4% in the US market and 10.9% in the Singapore Market.  This can be attributed to the introduction of the latest version of its Qwen large language model known as Qwen2.5 Max on January 29.

Alibaba said that Qwen2.5 Max can achieve competitive performance against the top tier models.  This includes recent releases from OpenAI and Meta Platforms. 

Alibaba also said that the new Qwen model outperforms fellow Chinese company DeepSeek's R1 AI on various benchmarks.  DeepSeek's claim that it trained R1 at a cost of just USD 5.6 million, has caused $NVIDIA(NVDA)$  and other AI related stocks to plummet.  Nvidia dropped  17% in one trading session, losing nearly USD 600 billion in market value.  This suggests that companies could slash their AI budgets and still get pretty decent results. 

Alibaba said that it evaluated Qwen2.5 Max alongside leading models.  These include DeepSeek V3, OpenAI's GPT-40 and Antrophic's  Claude 3.5 Sonnet, Meta Platforms' Llama 3.1-405B.  According to Alibaba, Qwen2.5 Max has demonstrated significant advantages across most benchmarks. 

Qwen2.5 Max is available in Qwen Chat.  Alibaba said that it is dedicated to enhancing the thinking and reasoning capabilities of large language models through the innovative application of scaled reinforcement learning.  This holds the promise to unlocking the potential in exploring uncharted territories of knowledge and understanding in AI. 

So now Alibaba can also be considered as an AI company apart from its dominant position in ECommerce. 

In Q3 24, Alibaba reported Revenue of USD 33.7 billion, an increase of 5% year over year. Its Net Income was USD 6.205 billion, an increase of 63% year over year.  Diluted Earnings Per Share was USD 2.15, a decrease of 4% year over year. 

According to CEO Eddie Wu, in Q3 24, Alibaba invested in user experience and strengthened its product offerings.  Its long term collaborations in payments and logistics on Taobao and TMall platforms are set to boost growth.  Cloud business growth accelerated with public cloud and AI related product revenues seeing significant increases.  AI related product revenue grew at triple digits year over year for the 5th consecutive quarter. 

Alibaba Cloud has gained notable recognition as the service provider of choice in China for public cloud and AI training and applications. 

Alibaba is set to release its Q4 24 earnings on February 12 before the market opens.  Wall Street Analysts are forecasting USD 3.03 Earnings per share and USD 36.19 billion in revenue as Alibaba's Cloud Division has shown  promising growth. 

Alibaba has a Buy rating with an Average Target price of HKD 125.18, an upside potential 33% according to Tipranks. 

As a small investor in Singapore, I like $Alibaba HK SDR 5to1(HBBD.SI)$ the best as

 it is a great way to invest in Alibaba without worrying about overseas trading fees, foreign exchange fees or management fees.  Dividends are also paid in Singapore Dollars.  HBBD is currently trading at a ratio of 5 to 1.    That means for every 5 SDRs held, the investor has a beneficial interest in one share of Alibaba.  The minimum lot in HBBD is 100 shares for Singapore.  So in other words, there is only a small capital outlay required to invest in HBBD compared to investing in the Hong Kong market for Alibaba. 

The current dividend yield for Alibaba is 1.02%.  Dividends are paid once a year usually in July, going ex dividend around mid June 2025.

The best part of investing in HBBD now is Tiger Brokers' commission free promotion for HBBD valid till the end of March 2025.  

I believe that Alibaba has tremendous exponential growth ahead especially with its new AI Qwen2.5 Max.  At the current price it is still undervalued.   However due to the latest tariff imposed by the US on China,  Alibaba's share price  may be negatively impacted.  Latest breaking news from CNBC on February 4said that China will impose additional tariffs of up to 15% on select US imports starting February 10 as a retaliatory  move. 

However I believe that in the long term, Alibaba is a great company to invest in and I will seize the opportunity to buy HBBD should there be price weakness. 

As Warren Buffett likes to say When there is Fear in the markets it is time to be greedy. 

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