Alibaba's Lazada Courts Armani and Other Luxury Brands, Seeks Edge Over Rivals in Southeast Asia

Benzinga · 10/14 14:59

Alibaba Group Holding (NYSE:BABA) is ramping up efforts through its international e-commerce division, Lazada, to attract top European fashion and design brands to stay relevant versus rivals like Sea Ltd’s (NYSE:SE) Shopee, ByteDance’s TikTok, and PDD Holdings Inc (NASDAQ:PDD).

The Chinese e-commerce juggernaut’s international arm aims to position itself as a critical player in the competitive Southeast Asian market, targeting $100 billion in e-commerce volume by 2030.

As part of this push, Lazada executives, including Chief Business Officer Jason Chen, met with over 100 Italian luxury brands, including Armani, Dolce & Gabbana, and Ferragamo, during an event in Milan this week, SCMP reports.

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For the first time, Lazada became EBITDA positive in July 2024, backed by its artificial intelligence-enabled operations and improved online marketing, the division’s chief James Dong told SCMP. He said Alibaba had injected $7.4 billion into Lazada.

For the first quarter, Alibaba’s international commerce retail business topline grew by 38% to $3.26 billion, compared to its total revenue of $33.47 billion.

China’s tech barometer Alibaba Group stock gained over 28% in the last 30 days, marking a stimulus-driven rally as it grappled with a weak domestic economy coupled with geopolitical tensions with the US, further stunting its growth prospects. Alibaba is grappling with an intense price war with its domestic e-commerce rivals.

Will Alibaba Stock Go Up?

When trying to assess whether or not Alibaba will trade higher from current levels, it's a good idea to take a look at analyst forecasts.

Wall Street analysts have an average 12-month price target of $107.27 on Alibaba. The Street high target is currently at $130.0 and the Street low target is $85.0. Of all the analysts covering Alibaba, 9 have positive ratings, 2 have neutral ratings and no one has negative ratings.

In the last month, 2 analysts have adjusted price targets. Here's a look at recent price target changes [Analyst Ratings]. Benzinga also tracks Wall Street's most accurate analysts. Check out how analysts covering Alibaba have performed in recent history.

Stocks don't move in a straight line. The average stock market return is approximately 10% per year. Alibaba is 45.85% up year-to-date. The average analyst price target suggests the stock could have further downside ahead.

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Price Action: BABA stock is down by 1.26% at $108.76 at the last check Monday.

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