Nomura lists Alibaba, Tencent, JD HEALTH, and ZEEKR as top picks in Chinese internet stocks

Nomura published a research report indicating that it recently conducted a week-long survey of the Chinese internet industry in several cities in mainland China, meeting with the management of 21 companies and industry experts, covering most sub-sectors of the Chinese internet industry. From this, it listed its preferred stocks in the internet sector as Alibaba (BABA.US), Tencent (00700.HK), JD HEALTH (06618.HK), and ZEEKR Express-W (01519.HK).

Nomura pointed out that Alibaba's management revealed that consumer sentiment was weak as of the end of December last year, leading to intensified competition in the e-commerce industry. They are closely monitoring the tightening of value-added tax policies, which could become a negative factor. Currently, they remain optimistic about the development of its AI cloud business. Nomura estimates that Alibaba's customer management revenue (CMR) growth may significantly slow to only 1%, while it expects Alibaba Cloud's revenue to grow by 38% year-on-year in the last quarter and believes that the losses in its instant retail business may have narrowed significantly.

Additionally, Nomura also anticipates that the upcoming IPO of Kunlun Chip could become a key catalyst for Baidu-SW (09888.HK), giving Baidu (BIDU.US) a "Buy" rating in the US stock market