Alibaba Group Stock In Focus Following $1.3B Sale Of Intime Stores: Retail Sentiment Brightens
By Stocktwits Inc | First Published Dec 18, 2024, 2:59 PM ISTAlibaba, which has a 99% stake in Intime, had bought the company in 2017 for $2.6 billion in a bid to grow its physical stores segment
Chinese retail giant Alibaba Group Holding’s ADR shares rose in after-hours trading session on Tuesday after the company said it was divesting its Intime Stores division for $1.3 billion, lifting retail sentiment.
The retail giant will reportedly book a $1.3 billion loss from the divestment, according to several media reports. A consortium made up of Youngor Fashion and members of Intime's management team have bought the business for 7.4 billion yuan, Reuters reported.
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The latest transaction is part of Alibaba's strategy to combine its domestic and international e-commerce businesses, and divest certain non-core assets. The move follows a revamp last year that split the company into six business units. The company also saw a series of top management changes following the revamp.
Alibaba, which has a 99% stake in Intime, had bought the company in 2017 for $2.6 billion in a bid to grow its physical stores segment.
Its other consumer sector assets up for sale include Freshippo and RT-Mart, according to a a Reuters report.
Retail sentiment on Stocktwits turned ‘bullish’ (57/100) from ‘bearish’ (28/100) a day ago.
Bullish sentiment among Stocktwits users centered around an expectation of an imminent price increase. Many retail investors are predicting a rally of Chinese stocks by the end of the year, according to an ongoing Stocktwits poll.
One user was predicting a $100 price target on Alibaba, another pegged a $120 price by year-end.
Last week, Alibaba stock rose on the back of optimism from China stimulus but caution set in as trade data from Chinese government showed falling numbers for November.
According to a recent Barron's report, Chinese exports in November increased by 6.7%, a decline compared to the 12.7% jump in October. That number didn’t take into account imminent tariffs that could impact a number of Chinese consumer stocks.
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