China Merchants Securities International has reaffirmed Alibaba as its premier choice within China's internet landscape, hiking its target price by a notable 25%, from HK$158 to HK$198, while keeping its 'Overweight' recommendation intact. The report underscores Alibaba's strategic advantage, noting how its comprehensive technology stack and diverse product lineup position it as a prime beneficiary in the burgeoning artificial intelligence (AI) sector. Given the heightened capital expenditure allocations and robust market appetite, China Merchants Securities International has upwardly adjusted its cloud business revenue projections for Alibaba's fiscal 2026 and 2027. It now anticipates year-on-year revenue growth of 27% and 25%, respectively, with profit margins expected to remain steady. Additionally, revenue and core net profit projections for fiscal 2027-2028 have been slightly revised upwards, albeit by no more than 1%, driven by AI product innovation and market dominance. However, it's important to note that this article should not be construed as investment advice; thorough verification is recommended prior to any investment decisions.