Discounted Cash Flow (DCF) Analysis Unlevered

Alibaba Group Holding Limited (BABA)

$102.18

-1.20 (-1.16%)

All numbers are in Millions, Currency in USD

Stock DCF: 925.55 | 102.18 | undervalue

Operating Data

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	40,042.56	60,295.04	81,553.76	114,766.24	136,489.92	186,134.20	253,835.16	346,160.40	472,066.28	643,766.80
Revenue (%)
EBITDA	17,260.48	23,473.44	34,816.32	37,158.56	25,238.40	65,368.91	89,144.97	121,568.89	165,786.08	226,085.99
EBITDA (%)
EBIT	13,737.28	17,540.64	28,028	29,493.12	17,548	50,747.86	69,205.93	94,377.60	128,704.73	175,517.37
EBIT (%)
Depreciation	3,523.20	5,932.80	6,788.32	7,665.44	7,690.40	14,621.06	19,939.04	27,191.30	37,081.35	50,568.62
Depreciation (%)

Balance Sheet Data

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Total Cash	33,633.60	32,506.40	58,114.40	77,351.20	72,813.60	122,815.82	167,486.54	228,404.95	311,480.67	424,772.80
Total Cash (%)
Account Receivables	4,295.52	5,537.44	8,296.96	10,253.76	13,189.44	18,123.02	24,714.75	33,704.03	45,962.90	62,680.59
Account Receivables (%)
Inventories	725.60	1,365.44	2,377.44	4,457.28	4,813.92	5,361.63	7,311.76	9,971.21	13,597.95	18,543.81
Inventories (%)
Accounts Payable	6,458.08	8,313.28	10,747.68	15,098.88	17,152.80	25,618.63	34,936.67	47,643.88	64,972.97	88,605.02
Accounts Payable (%)
Capital Expenditure	-4,773.76	-7,942.88	-7,261.76	-6,909.60	-8,531.84	-17,225.16	-23,490.32	-32,034.24	-43,685.78	-59,575.22
Capital Expenditure (%)

Weighted Average Cost Of Capital

Share price	$ 102.18
Beta	0.630
Diluted Shares Outstanding	2,723.38
Cost of Debt
Tax Rate	-4.53
After-tax Cost of Debt	11.67%
Risk-Free Rate
Market Risk Premium
Cost of Equity	6.466
Total Debt	28,255.52
Total Equity	278,274.46
Total Capital	306,529.98
Debt Weighting	9.22
Equity Weighting	90.78
Wacc

Build Up Free Cash

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	40,042.56	60,295.04	81,553.76	114,766.24	136,489.92	186,134.20	253,835.16	346,160.40	472,066.28	643,766.80
EBITDA	17,260.48	23,473.44	34,816.32	37,158.56	25,238.40	65,368.91	89,144.97	121,568.89	165,786.08	226,085.99
EBIT	13,737.28	17,540.64	28,028	29,493.12	17,548	50,747.86	69,205.93	94,377.60	128,704.73	175,517.37
Tax Rate	36.16%	8.66%	10.33%	9.06%	-4.53%	11.94%	11.94%	11.94%	11.94%	11.94%
EBIAT	8,769.29	16,021.21	25,133.12	26,821.29	18,343.33	44,690.39	60,945.23	83,112.31	113,342.02	154,566.92
Depreciation	3,523.20	5,932.80	6,788.32	7,665.44	7,690.40	14,621.06	19,939.04	27,191.30	37,081.35	50,568.62
Accounts Receivable	-	-1,241.92	-2,759.52	-1,956.80	-2,935.68	-4,933.58	-6,591.73	-8,989.28	-12,258.87	-16,717.68
Inventories	-	-639.84	-1,012	-2,079.84	-356.64	-547.71	-1,950.14	-2,659.44	-3,626.74	-4,945.86
Accounts Payable	-	1,855.20	2,434.40	4,351.20	2,053.92	8,465.83	9,318.04	12,707.21	17,329.09	23,632.05
Capital Expenditure	-4,773.76	-7,942.88	-7,261.76	-6,909.60	-8,531.84	-17,225.16	-23,490.32	-32,034.24	-43,685.78	-59,575.22
UFCF	7,518.73	13,984.57	23,322.56	27,891.69	16,263.49	45,070.83	58,170.13	79,327.85	108,181.07	147,528.82
WACC
PV UFCF						42,141.96	50,855.57	64,846.02	82,685.26	105,432.11
SUM PV UFCF										345,960.92

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	6.95
Free cash flow (t + 1)	150,479.39
Terminal Value	3,039,987.77
Present Value of Terminal Value	2,172,540.55

Intrinsic Value

Enterprise Value	2,518,501.47
Net Debt	-2,128.16
Equity Value	2,520,629.63
Shares Outstanding	2,723.38
Equity Value Per Share	925.55