- Recent quarterly report by Alibaba has shown a strong performance within its delivery business.
- The Local Consumer Services business segment grew by 29% on a YoY basis and improved EBITA margin by 30 percentage points.
- Recent regulatory fines in China have shown that the aggressive moves to gain market share in the delivery business would be coming to an end.
- This should help in rapid improvement of margins in the next few quarters which can help the overall profitability of Alibaba.
- The last-mile delivery business has a strong business model and unit economics which should allow Ele.me to deliver positive results and become a key driver for bullish sentiment.
For further details see:
Alibaba Shows A Surprising Win