Alibaba’s Strategic Overhaul: A Bold Move to Streamline and Compete

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Alibaba Group is currently implementing one of the most significant strategic shifts in its recent corporate history. This radical restructuring involves the complete retirement of a core brand after 16 years, a move designed to unify its sprawling ecosystem. As the company's shares undergo a period of consolidation, institutional investors appear to be seizing the opportunity to build positions. The strategic pivot raises questions about Alibaba's competitive stance against rival Meituan.

Recent regulatory filings from the United States reveal a notable vote of confidence from a major investor. Clear Street LLC has established a significant new position in Alibaba, acquiring over 500,000 shares valued at approximately $58.5 million. This accumulation by a professional investment firm contrasts with the hesitancy seen among some retail investors during recent market volatility. The move suggests that certain institutional players are betting on the long-term efficacy of Alibaba's restructuring and its renewed focus on artificial intelligence.

The Integration of Ele.me into Taobao

A central component of this transformation was finalized on Friday, December 5, with the official retirement of the "Ele.me" brand. This food delivery service, once a dominant force in China's meal delivery sector, is being fully integrated into the Taobao ecosystem and rebranded as "Taobao Shangou" (Taobao Flash Sale). This is far more than a superficial name change; it represents a full operational merger.

Users are now being directed to a new interface that leverages the massive user traffic of Alibaba's flagship Taobao app. The strategic objective is clear: to consolidate logistics networks and user bases, enabling a more aggressive challenge against market leader Meituan in the instant delivery segment (often termed "everything in one hour"). By dissolving Ele.me's standalone identity, Alibaba aims to break down internal barriers and increase transaction frequency within its primary application.

AI Ambitions and Technical Chart Position

Beyond the retail reorganization, Alibaba is accelerating its "Full-Stack AI" strategy. The integration of its proprietary Qwen large language models into its cloud infrastructure is intended to deepen ties with enterprise clients. The transformation of Ele.me into Taobao Shangou is also designed to harness these AI capabilities for more precise demand forecasting and logistics optimization.

From a technical analysis perspective, Alibaba's stock is in a corrective phase. With a current Relative Strength Index (RSI) reading of 29.4, the equity is technically in oversold territory. While the share price trades notably below its 50-day moving average of 142.46 euros, it continues to hold above the more significant long-term 200-day moving average.

The company is now in the execution phase of its operational overhaul. Eliminating the Ele.me brand sheds legacy structures but must be implemented seamlessly to avoid alienating users. For a technical trend reversal to gain traction, bulls will need to reclaim the resistance level posed by the 50-day moving average to neutralize the current short-term downward pressure.