www.ft.comShares of Alibaba.com, China's biggest e-commerce company, nearly tripled in price on its Hong Kong debut yesterday, in one of the biggest first-day jumps there in recent years.
Alibaba.com, part of the Alibaba group that also includes auction website Taobao and e-payment system Alipay, raised US$1.5bn in the world's biggest internet offering since Google's flotation in 2004.
Alibaba.com matches Chinese suppliers with international buyers through its website, which has 25m registered users. It earns the majority of its revenues from companies subscribing for value-added services.
The company's share price opened at HK$30, compared with its offer price of HK$13.5, and closed at HK$39.5, a gain of nearly 193 per cent.
This places Alibaba.com as the fourth-largest first-day gain in Hong Kong during the past three years, according to Thomson Financial. Alibaba.com's first-day surge is the biggest this year, but falls far short of the 920 per cent first-day gain achieved by Wing Hong holdings, a little-known construction company, in 2004.
Yesterday's closing share price of HK$39.5 values Alibaba.com at about $25.6bn and ranks it fifth among global internet companies and top in Asia outside Japan.
It also makes the company one of the most expensive stocks in Hong Kong. At HK$39.5, Alibaba.com trades at 306 times projected 2007 earnings of Rmb622m.
Hong Kong's benchmark Hang Seng Index fluctuated throughout the day after the market fell 5 per cent on Monday in reaction to news of the delay of a proposed scheme allowing mainland Chinese citizens to buy Hong Kong-listed shares. The Hang Seng yesterday closed up 1.71 per cent at 29,438 points.
Jack Ma, Alibaba group's founder and chairmancom's offer pricing was “reasonable”, adding that “China is a place where miracles are made”.
