Billionaire Lei Zhang’s 10 Stock Picks with Huge Upside Potential

6. Alibaba Group Holding Limited (NYSE:BABA)

Hillhouse Capital’s stake: $414,394,167

Upside Potential: 34.41%

Number of Hedge Fund Holders: 107

Alibaba Group Holding Limited (NYSE:BABA), founded in 1999 by Jack Ma, is a leading Chinese multinational technology company specializing in e-commerce, retail, cloud computing, and digital media. Headquartered in Hangzhou, Alibaba operates popular platforms like Taobao, Tmall, and Alibaba.com. It also offers services in logistics, fintech through Ant Group, and cloud infrastructure via Alibaba Cloud. The company plays a key role in China’s digital economy and has a growing global presence.

Bernstein recently upgraded Alibaba Group Holding Limited (NYSE:BABA) to Outperform from Market-Perform, citing optimism about AI-driven growth in Alicloud and improved capital allocation. The firm raised its price target to $165 from $104 for US shares. The firm highlighted that Alibaba’s shares have surged since China’s “DeepSeek moment,” as investors increasingly value Alibaba Cloud in a sum-of-the-parts analysis. While AI hype may have cooled, Bernstein believes Alibaba’s earnings outlook has improved due to its more disciplined investment strategy, focusing on AI infrastructure over global e-commerce expansion. According to Bernstein, Alibaba Cloud must grow revenues by 25–30% by FY2026 to offset high capex, but its higher margins make it a strong contender in China’s AI race. Domestic e-commerce improvements, including stronger ad tech and rising commissions, also bolster the bullish view.