Start again! Choi Sung-sun increased her holdings of Ali (09988) shares by about HK$82 million, increasing her holdings by HK$160 million over the two days

The Zhitong Finance App learned that on August 25, according to information from the Hong Kong Stock Exchange, Alibaba Group (09988) Chairman Cai Chongxin once again increased his holdings of Alibaba Hong Kong shares by 720,000 shares, at an average price of about HK$113.47, at an average cost of HK$82 million. This is the second consecutive trading day since Ali's IPO was placed, and the cumulative increase in holdings reached HK$160 million over the past two days.

On the previous day, Cai Chongxin and Alibaba CEO Wu Yongming had increased their holdings of Hong Kong Alibaba shares by a total of 1.07 million shares, for a total amount of about HK$120 million. Among them, Choi Chung-sun bought 720,000 shares, an average of about HK$112 per share, at a cost of about HK$80 million; Wu Yongming bought 350,000 shares, with an average cost of about HK$111.6 per share, at an average cost of about HK$40 million. Over the two days, the two have increased their holdings to a total value of over HK$200 million.

This increase in management holdings comes after Alibaba completed a large-scale IPO. On August 23, Alibaba announced the placement of 710 million new shares at HK$11,270 per share. It is estimated that the total proceeds from the placement will be around HK$80 billion. The proceeds will mainly be invested in full-stack AI capabilities and AI infrastructure construction. The placement was actively subscribed by long-term investors such as global sovereign wealth funds, and the amount was oversubscribed by nearly 3 times.

According to market analysis, management continued to increase its holdings with personal capital after the placement was completed, indicating that management is using funds and actions to strengthen the market's confidence in AI's long-term strategy. According to public information, Alibaba has continued to expand the AI circuit in recent years, and has formed a full-link AI strategic layout covering computing power, chips, large models, and application ecosystems.

A number of brokerage firms have also given their own judgments regarding this placement and management increase in holdings. Bank of America Securities maintains a “buy” rating and a target price of HK$168. It believes that although the placement brings short-term pain of dilution of equity and rising depreciation costs of AI infrastructure, Ali's net cash will increase dramatically from about US$31 billion to over US$41 billion, which is conducive to optimizing the balance sheet, broadening funding sources, and providing sufficient financial guarantees for cloud business growth and AI investment. Nomura Securities, on the other hand, pointed out that the issuance of about 710 million new shares diluted the existing shareholders' shares by only about 3.7%. The actual impact was far lower than market expectations, and the financing uncertainty that had been hanging over the stock price for a long time was removed in one fell swoop.

However, Jason Chan, a senior investment strategist at the Bank of East Asia, believes that this allotment of shares was quite surprising to the market, whether judging from the scale of capital raised or the margin of discount. The stock will face a certain amount of equity dilution pressure, and the market will once again examine how much return fierce AI competition can bring.