BABA Stock

DeepSeek's AI model efficiency has led to major progress in GenAI, particularly in China, where Alibaba Group Holding Limited is at the forefront with its Qwen series of large language models. The company's latest AI innovations, such as Qwen 2.5-VL and 2.5 Max, make it a promising option for AI investments in 2025, supporting my recommendation to buy. Additionally, Alibaba's Cloud revenue is expected to grow significantly, thanks to the popularity of Qwen models and strong performance in other areas of the business.

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Excitement in Silicon Valley shifted to worry this week when a Chinese startup named DeepSeek launched a new large language model (LLM). It's quite impressive.

I believe that Alibaba's introduction of the Qwen 2.5 Max AI model is a good step for its cloud computing sector. Investor confidence seems to be rising after the selloff in 2020, and the stock has been increasing over the past year. However, I am worried about the competition from Pinduoduo, JD.com, and new AI companies like SenseTime and Baidu.

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Alibaba can take advantage of DeepSeek-R1's AI improvements to lower research and development expenses and strengthen its AI skills, particularly when chip resources are limited. By incorporating R1's chain-of-thought approach into Alibaba Cloud's AI as a Service, the company could increase its income and improve operations such as logistics through better problem-solving. DeepSeek's advanced distillation method matches Alibaba's focus on small and medium enterprises, providing effective AI solutions at reduced prices, which could appeal to budget-conscious customers.

Alibaba (BABA) experienced a significant rise in its stock price during the last trading session, with trading volume exceeding the usual amount. However, the recent changes in earnings estimates might not lead to additional price growth in the short term.

In the fourth quarter of 2024, the Fund fell by 7.35%, doing better than the MSCI Emerging Markets Index but not quite matching the MSCI Emerging Markets IMI Growth Index. The main contributors to the Fund's performance were Taiwan Semiconductor Manufacturing Company Limited and HD Hyundai Heavy Industries Co., Ltd., thanks to high demand and their technological advantages. On the other hand, Swiggy Limited and Alibaba Group Holding Limited negatively impacted the Fund, as Swiggy's IPO did not perform well and Alibaba struggled with growth in its domestic market.