<ET Net News Agency, 15 August 2011> Goldman Sachs lowered its target price for Alibaba
(01688) to HK$13 from HK$14, and retained its "neutral" rating.
After attending results briefing, the house noted that both GS and CTP net adds were
negative (4.3K/12.5K qoq) in 2Q, and management expects it to remain negative in 2H, due
to ongoing uality initiatives, GS price hikes and the halt of CTP individual editions.
In addition, gross margin decline of 2.8 pp yoy was attributed to higher revenue
contribution from the transaction platforms as well as Vendio and Auctiva.
But Goldman raised its 2011-2013 EPS by 7%-14% on higher margin assumptions due to
better cost control, partly offset by lower subscribers.
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