JD - Alibaba: A Blinding Silver Lining From DiDi's Firestorm

• The onslaught of fresh uncertainties on Chinese internet stocks evoked an intense desire to capitulate. However, evidences suggest the market is misguided and sellers could come to regret.
• The indiscriminate sell-off last week epitomizes the throwing of the baby with the bathwater, as investors aggrandized DiDi's fiasco broadly across the entire sector.
• The VIE risk has been grossly misrepresented as China favors access to deep capital markets. The proposed approval by Beijing could bestow a level of legitimacy on the VIE structure.
• The valuation gap between U.S. tech firms and their Chinese peers has widened considerably, even as the former are experiencing stronger regulatory headwinds and global challenges.
• The media coverage on Alibaba is increasingly positive, while Europe's tilt towards China bodes well for Alibaba's global expansion.

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