By Tracy Qu

Alibaba Health Information Technology shares rose after the healthcare company posted better-than-expected earnings as improved efficiency trimmed costs for its warehousing, logistics and customer services.

Shares were 13% higher to 3.46 Hong Kong dollars (44 U.S. cents) early Tuesday, outperforming the Hang Seng Index's 0.6% rise and lifting this week's gain to 18%.

The company, backed by Chinese e-commerce giant Alibaba, said late Monday that its bottom line for the year ended March 31 rose 65% to 883.48 million yuan (US$122 million). That beat the estimates for CNY696.9 million from a Factset poll of analysts.

Revenue rose 1.0% to CNY27.03 billion, beating Factset estimates for CNY25.41 billion.

Fulfilment expenses--related to warehousing, logistics and others--fell 17% on year, while sales and marketing expenses were roughly steady.

The company said its "Internet + Healthcare" service model was further refined in the last fiscal year and benefited from Beijing's policy to support growth in the sector. Its Tmall Healthcare Platform served over 35,000 merchants as at March 31, 2024, a rise of 28% from the year before.

Revenue from its pharmaceutical direct sales business, which accounted for about 88% of its total revenue, rose 0.6% to CNY23.7 billion.

Its earnings beat Alibaba Health's guidance in late March for a 5% fall in revenue and a 30% rise in profit, Citi Research analysts highlighted in a note. Citi currently has a buy rating on its shares with a HK$8.00 target price.

Write to Tracy Qu at

(END) Dow Jones Newswires

05-28-24 0057ET