After months of speculation the Chinese Internet colossal Alibaba Group Holding Ltd. is set for the tomorrow’s most anticipated IPO of 2014,.
What can we consider it as the biggest stage, the Chinese giant on the New York Stock Exchange debut could raise as much as $24.3 billion including an over-allotment option, beating Agricultural Bank of China Ltd.’s $22.1 billion sale in 2010.
Amidst of background of strong investor demand, the dominant e-commerce power in in China increased the top end of the price range between $66 and $68 a share.
The shares are expected to be priced after the closure of markets at 4 p.m. on Thursday and the trading will begin on Friday.
Alibaba, Hangzhou-based group of Internet-based e-commerce operates from background. For every $1 of revenue, it keeps around $0.43.
On comparing with its biggest rival Amazon, Amazon was found notching only $0.01 in profit for every dollar of revenue.
The privately owned giant was started by a schoolteacher Jack Ma, now Alibaba Chairman and former CEO, 15 years ago in his apartment. The company’s network of sites includes Taobao, China’s largest consumer-to-consumer online shopping platform similar to eBay; Tmall, a shopping hub for brands like Apple and Gap, to sell direct to customers and AliExpress, an online retail service made up of mostly small sellers offering products to online buyers. as well as Alibaba.
On June 11, 2014, Alibaba launched U.S. shopping site 11 Main, in competition with Amazon and eBay.
After being rejected by Hong Kong officials, Alibaba chose New York as the new site for its IPO. Hong Kong Exchanges and Clearing Ltd rejected its request to allow a small group of company insiders to nominate the majority of its board.
“People say that Hong Kong lost the Alibaba deal. To me, I think it is Alibaba that missed this great opportunity to list in Hong Kong,” Ma added. “We love Hong Kong. We will continue to love Hong Kong and invest in Hong Kong.”
The much awaited debut in the 222 year-old exchange’s technology is planned under the name ‘BABA.’
Alibaba’s earnings prior to interest, taxes, depreciation and amortization is 59 percent of revenue. It is the highest among the 10 comparable companies in the list, according Wedbush Securities Inc.
The list contains the following famous name too Google Inc., Facebook Inc., Amazon.com, Baidu and Tencent, among others.
According to Alibaba’s recent F-1 SEC filing, it has just under 300 million customers. So it deduces that the only three countries with comparatively larger than that are the United States, China, and India.
After possessing about 80% of China’s e-commerce market, Alibaba plans to expand its business in the United States and Europe after the deal.