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<Research>Macquarie Expects Mainland Cloud Service 'Price War' to Have Hit Floor, Optimistic About Alibaba Cloud Transformation
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The "price war" era among Chinese cloud service providers seems to have hit a floor, Macquarie said in a research report. Following similar actions by Tencent Cloud, Alibaba Cloud officially announced on its website on March 18 that it will ramp up the prices of its AI computing and storage services starting mid-April. This move suggested that with the exponential growth in global AI demand, the demand for cloud services drifted higher, simultaneously driving spike in supply chain and hardware costs, prompting notable price hikes. In a constrained supply environment, the industry is undergoing widespread price adjustments. Macquarie considered the establishment of Alibaba Token Hub (ATH) as a major milestone, completing the "missing piece" in the company's AI strategy. By integrating multiple application and infrastructure units under a unified framework, the broker believed Alibaba is actively eliminating the siloed approach that may have hindered its AI execution in the past. The broker remained optimistic about Alibaba as a unique infrastructure play within its coverage. It added Alibaba H-shares to the "Marquee Buy" recommendation list. The target price for H shares was HKD216, and the target price for Alibaba (BABA.US) US shares was USD222.1. AASTOCKS Financial News Website: www.aastocks.com |
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