Latest posts by Salwin (see all)
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On Tuesday, the Chinese tech giant, Alibaba witnessed a strong debut in Hong Kong. The e-commerce giant priced its share at 176 Hong Kong dollars apiece (approx. $22.5) and it became the world’s largest listing so far this year.
Alibaba’s listed shares swell more than 6% around 9:30 am HK/SIN, before it hit 189.50 Hong Kong per share by early intraday. The stock ended its opening trading day with 6.6% above its listing price.
The tech giant has issued 500 million new ordinary shares and 75 million ‘greenshoe’ options. The underwriting banks will be immune to sell more shares compared to the original amount set if overallotment option is exercised. One analyst informed that the Alibaba’s Hong Kong listing has been pretty successful so far.
Tian Hou, CEO and founder of T.H. Capital said that in given time, the stock price will augment. The stock price is pretty attractive at the moment as Alibaba has been positioned as an ‘enabler’ for services such as storage of information and transaction of physical goods which will be catalysts for the business.
Another analyst commented that Alibaba’s debut in Hong Kong Stock Exchange is very positive and feasible. On September 2014, Alibaba went public and chose New York Stock Exchange for its debut. The secondary listing of Alibaba in Hong Kong is the world’s largest offering so far which is larger than Uber’s $8 million in May 2019. But it is expected to be beaten in December by anticipated listing of Saudi Aramco in Riyadh.
Mary Manning, Ellerston Capital’s portfolio manager said that it was very strange that China’s largest company was exclusively listed in the U.S. She wants to applaud Alibaba for listing in Hong Kong at a time when there was a widespread unrest in Asian financial hub since months and people had lost confidence.
The ongoing pro-democracy protests have considerably slowed the business and Alibaba’s offering is a huge boost for the market in Hong Kong.
Daniel Zhang, chairman and CEO of Alibaba during mid-November said over a letter to investors that in 2014 when Alibaba Group went public, they regretted missing out on Hong Kong as it is one of the most crucial financial centres of the world. He also said that they continued to believe over the years that Hong Kong’s future will remain bright with many encouraging reforms. He is hoping he can contribute in small ways to its future.
Manning said that Alibaba’s shares listed in the U.S. has big position in American depository receipts but her plan is to move the position to Hong Kong.