Alibaba: The End Of New Retail As We Know It?

Summary:

• BABA sells Intime, marking a shift from its New Retail initiative to focus on core e-commerce, booking a $1.3bn loss.
• The sale indicates New Retail’s failure, with BABA likely to dispose of more non-core assets like Sun Art and Fresh Hippo, in our view.
• Weak Chinese consumer demand and intense competition contribute to BABA’s strategic shift; we remain bearish on BABA.
• Recommend focusing on PDD for its low-cost leadership and global growth potential, especially through its Temu platform.

Reuters reported that Alibaba (NYSE:BABA), along with another minority shareholder, has agreed to sell 100% interest in the Intime department store to a group of investors including Intime management team and Youngor Group, an A-share listed apparel company.

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