SINGAPORE (BLOOMBERG) - Alibaba Group Holding has unveiled ambitious objectives for its South-east Asian arm Lazada, accelerating an overseas expansion to offset Chinese economic and regulatory headwinds.
The Chinese e-commerce leader is targeting a long-term goal of quintupling gross merchandise value (GMV), the sum of transactions across Lazada's platforms, to US$100 billion (S$136 billion), Alibaba outlined in a presentation to investors.
It wants Lazada to serve more than 300 million users eventually, according to a slideshow posted on its website.
Lazada, which Alibaba took over in 2016, is the Chinese corporation's main e-commerce business in the booming South-east Asian market.
Its importance has grown since Beijing launched a sprawling effort to curb the influence of Internet giants, spurring the likes of Alibaba and Tencent Holdings to ramp up their international businesses. The WeChat operator, which is grappling with a gaming clampdown at home, this month launched a global publishing arm to group A-list titles under one umbrella.
Singapore-based Lazada has grown its GMV to about US$21 billion over the past 12 months, after enlarging its active consumer base by 1.8 times to 130 million from March last year through September. That's way behind its chief rival in the region, Sea's Shopee, which operates in South-east Asia and Taiwan and reported more than US$56 billion of transactions over the four quarters to the end of September.
Lazada is now the third-largest online retailer in emerging markets by GMV, behind Mercado Libre but ahead of South Korea's Coupang and India's Flipkart, according to the presentation.
Lazada, Shopee and fellow Internet giants like Grab Holdings and Goto are riding an upswell of South-east Asian online commerce, which Alibaba says is growing about 27 per cent annually on average. Tencent-backed Sea raised its forecast for annual e-commerce revenue last month for a second time this year, underscoring how the pandemic continues to drive online spending.
South-east Asia's Internet economy is set to double to US$363 billion by 2025, research from Google, Temasek Holdings and Bain & Co shows.