Feeds

Alibaba.com soars on magic carpet

IPOpen sesame

High performance access to file storage

Faith in the promised Chinese internet boom went fanatical today, with speculators sending new shares in ecommerce portal Alibaba.com rocketing almost 200 per cent in its first day of trading.

The stock on offer opened in Hong Kong at $1.74, and closed at $5.15, having debuted 257 times oversubscribed.

That makes for a market cap of $25.7bn*, or about 155 times next year's estimated profits. By comparison, Wall Street wonderboy Google trades at 35 times its earnings.

Alibaba flogged off shares in its business trading tentacle, Alibaba International, raising $1.5bn. It marks the biggest internet IPO since Google raked $1.9bn in 2004. The Chinese firm took this as good enough reason to slap its own back in full-page Financial Times ads today.

Alibaba International offers Chinese businesses a cheap way to find each other and trade online. Its parent company Alibaba Group also runs Taobao.com, an eBay-style site pitched at Chinese consumers, which was not part of today's public offering.

The B2B site accounted for 43 per cent of Chinese ecommerce transactions in the three months ended 30 June, though many pay no charge to Alibaba for the service. Premium subscribers purchase preferential access to buyers.

The group was founded in 1999 by former English teacher Jack Ma, who said ahead of the sale that Alibaba aims to become the "leading e-commerce platform for China, Asia, and even the world".

"The performance of the shares today show our pricing was reasonable," he added after bagging the bucks. Some analysts had said even the initial price of $1.74 was a bit rich. They're expecting a correction when speculators who deliberately drive prices skywards soon cash out.

Yahoo! owns 39 per cent of Alibaba Group, which it got in return for ownership of Yahoo! China and $1bn in 2005. ®

*Small potatoes. Yesterday's flotation of Far East oil giant PetroChina created the world's first trillion-dollar company.

High performance access to file storage

More from The Register

next story
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Nokia offers 'voluntary retirement' to 6,000+ Indian employees
India's 'predictability and stability' cited as mobe-maker's tax payment deadline nears
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
It may be ILLEGAL to run Heartbleed health checks – IT lawyer
Do the right thing, earn up to 10 years in clink
France bans managers from contacting workers outside business hours
«Email? Mais non ... il est plus tard que six heures du soir!»
Adrian Mole author Sue Townsend dies at 68
RIP Blighty's best-selling author of the 1980s
prev story

Whitepapers

Mainstay ROI - Does application security pay?
In this whitepaper learn how you and your enterprise might benefit from better software security.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.