Alibaba’s sale of Intime in line with expectations, proceeds may be used for special dividend – Morgan Stanley
Alibaba’s sale of Intime in line with expectations, proceeds may be used for special dividend – Morgan Stanley

Alibaba’s sale of Intime in line with expectations, proceeds may be used for special dividend – Morgan Stanley

Alibaba Group has announced the sale of its entire stake in Chinese department store chian Intime and expected to receive proceeds of about 7.4 billion yuan, with about 9.3 billion yuan of loss expected in the transaction.

The sale of Intime came in line with the development strategy previously announced by Alibaba’s management, which was to anchor on core businesses such as Taobao and Tmall Group, Alibaba Cloud and Alibaba International Digital Commerce Group, and potentially spin off the offline retail business, said Morgan Stanley in its research report.

As the decrease in Intime’s asset value is within market expectations, the loss was not assumed to surprise investors, especially given that it was non-cash and nonrecurring (likely adjusted for non-GAAP financial metrics), the bank noted.

Alibaba may use the proceeds from the proceeds to pay a special dividend, it said.

Morgan Stanley rated Alibaba’s US stock a target price of $105 with a rating of Equalweight.