Macquarie released a research report stating it remains optimistic about Alibaba-W (09988) as a unique infrastructure investment within its coverage. The firm has added Alibaba's H-shares to its Marquee Buy recommendation list. The target price for the Hong Kong-listed shares is set at HK$216, while the target for Alibaba's US-listed shares (BABA.US) is $222.1. The report indicates that the era of "price wars" among Chinese cloud service providers appears to have bottomed out. Following similar actions by Tencent Cloud earlier, Alibaba Cloud officially announced on its website on March 18th that it will increase prices for its AI computing and storage services starting from mid-April. This move suggests that with the explosive growth in global AI demand, cloud service demand continues to rise, simultaneously driving significant increases in supply chain and hardware costs, which in turn leads to substantial price hikes. In a supply-constrained environment, the industry is undergoing broad price adjustments. According to the announcement, Alibaba Cloud will implement price increases of 5%-34% for its T-Head Zhenwu 810E and related AI chip services, and an approximate 30% price increase for its Cloud Parallel File Storage (CPFS) service. The bank anticipates that these price adjustments will begin to boost Average Revenue Per User (ARPU) for the cloud business starting in the June quarter. Combined with surging token demand and enterprise AI adoption, the bank believes Alibaba Cloud will achieve superior revenue growth in the fiscal year ending March 2027. More importantly, despite market concerns over a significant decline in overall profit margins due to high capital expenditure and large language model training costs, the changing revenue mix within the cloud business remains favorable. Revenue is gradually shifting from low-margin generic IaaS to higher-value PaaS and SaaS. Macquarie views the establishment of Alibaba's "Model Studio" as a significant milestone, completing the "missing piece" in the company's AI strategy. By consolidating multiple application and infrastructure units under a unified framework, the bank believes Alibaba is actively eliminating silos that may have hindered its AI execution in the past.