A hyperactive purchase of the stock pushed up costs by 193% on the first trading day, making it the fourth-biggest first-day increase in the stock exchange in three years of Hong Kong. The conclusion of price of US$5.09 per share valued Alibaba.com at around US$25.6 billion and made it the fifth-largest amid international internet companies and the largest in Asia outside Japan. In addition, it made the firm one of the most high-priced stocks in Hong Kong, trading at 306 times the business's projected 2007 gains. By comparison, internationally established brand names for example Yahoo and Japan's Softbank, both leading stockholders of Alibaba.com, were trade at only 60 times their projected earnings.
Shareholders were consequently displaying extreme optimism towards Alibaba.com's earning outlook by paying a substantial premium to own the company's shares. As observers and venture capitalists have noted, China is becoming a centre of technology and a major pole for initiation. Chinese technological master who have honed their entrepreneurial and technical abilities in the West has copied and refined many successful dot com strategies in the West. These "sea turtles" are surpassing international giants enjoys Google and eBay in the burgeoning Chinese market and have their sights set on global domination. Armed with profits from a record-breaking IPO, Alibaba.com is poised to stay ahead in the increasingly-competitive on-line B2B marketplace in China. What strategies can the business pursue and what pitfalls must it avoid?
PUBLICATION DATE: June 26, 2008 PRODUCT #: HKU776-PDF-ENG
This is just an excerpt. This case is about GLOBAL BUSINESS
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