[ET Net News Agency, 1 June 2020] Morgan Stanley lifted its target price for Alibaba
Health Information Technology (00241) to HK$21.4 from HK$14.5 and maintained its
"overweight" rating.
The research house said both Ali Health's 2H FY2020 revenue and adjusted net income
beat, driven by direct pharma and internet healthcare.
Given AliPay has 900mn active users and has been rapidly expanding its hospital network
(400+ Class III hospitals connected to medical insurance payment through AliPay), Morgan
sees room for Ali Health to further monetize its parent's traffic. The newly launched
chronic disease program in partnership with pharma companies aims to build 100mn members
in three years, for a recurring income stream with a higher margin.
Also, recent NHC (National Health Commission) guidelines on internet healthcare and
pilot rules at some provinces may finally pave the way for reimbursement of some online
medical activities, benefiting industry leaders with a broad hospital network, government
relationships and technical know-how - Ali Health ticks all the boxes, Morgan noted. (KL)