Alibaba, China’s e-commerce barometer, tipped for solid earnings growth

E-commerce powerhouse Alibaba Group Holding is expected to blow past its own estimate of 53 per cent year-on-year revenue growth in the 12 months ended March 31, driven by mainland China’s booming online retail market.

New York-listed Alibaba, which will report its fiscal year to March earnings before the US market opens on Thursday, serves as the unofficial barometer for many analysts to determine the heath of e-commerce in the world’s second-largest economy.

“We believe that Alibaba will continue to be a key beneficiary of the growing disposable income among the Chinese population,” eMarketer senior forecasting analyst Shelleen Shum said on Wednesday. “This has led to a shift in spending on low-cost and basic necessities to higher quality lifestyle products.”

Alibaba is expected to post a 55 per cent year-on-year jump in net profit to 11.8 billion yuan (US$1.7 billion) for the March quarter on revenue of 35.9 billion yuan, up 48 per cent year on year, according to consensus estimates from analysts surveyed by Bloomberg.

China’s National Bureau of Statistics last month reported a 32 per cent increase in mainland online retail sales from January to March to 1.4 trillion yuan.