Next week, around 18-19 September will take place the IPO of Alibaba, would be to say the Initial Public Offer or Initial Offer to the Public of Alibaba shares (and it is already possible to invest in Alibaba). The very large Chinese company, world leader in e-commerce, has in fact decided to become a company and this is tempting for many investors, both large and small. On Monday 8th, the so-called “roadshow”, a series of meetings between the company’s managers and large investors who are considering buying Alibaba shares, also started. Given the size of the company and its capitalization, there will be room for all, but of course there will be some strong powers in the field. When we talk about capitalization, we’re talking about over $150 billion, according to Alibaba experts.
As for the Alibaba IPO, here are the specific data of the operation:
- Estimated share price: 60 – 66 $.
- Title Name on the Stock Exchange: BABA.
- Stock exchange on which the security will be listed: NYSE (New York Stock Exchange).
- Estimated capitalization value: 150 billion dollars.
Not everyone is familiar with this society; on the contrary, there are many who do not know it at all or who have heard of it from time to time. Well, when we talk about Alibaba we are talking about Amazon’s most feared competitor, firstly, and eBay, secondly. Alibaba’s main portal in fact looks a lot like Amazon.com, whose capitalization at the moment is 150 billion. However, although the challenge may seem equal, it is not the case at the moment. At the moment, in fact, Alibaba is achieving higher results than eBay and Amazon combined, without leaving China too much. In the country of red lanterns, Alibaba is the boss and can count on an impressive market. With the arrival in the West, starting precisely from a descent into the Stock Exchange, Alibaba is preparing to become a point of reference in the world and thus increase its weight on the competition.
A Big Difference
Alibaba is not just a portal, a site with a final .com. Alibaba is structured in a completely new way. Among the activities managed by Alibaba we find:
- Tmall: an online store-like portal where you can buy branded retail products.
- Taobao: a large portal with which many small companies and traders rely to sell and resell retail with a physical base, a real phenomenon that is changing the villages of China.
- AliPay: like Paypal, it is an electronic payment method managed by Alibaba. In 2014, 623 billion euros in transactions were already carried out.
- 1688.com: a portal dedicated to the wholesale market for sale on the domestic market (i.e. small businesses).
- Aliyun: a more “logistics” component, dedicated to infrastructures and the cloud, could not be missing.
Let’s do some numbers to close the presentation of Alibaba’s IPO:
- 12.7 billion commercial transactions in 2013, or more than 34 million per day.
- Estimated for 2015: 713 billion transactions per year.
- In the fourth quarter of 2013 the Gross Merchandise Volume was equal to 4 times that recorded by eBay.
- Last quarter revenues +45%, $2.25 billion, more than those of eBay and Amazon combined.
- Users rise tens of millions every month, and the company is first for mobile users.
How to Invest in the Alibaba IPO
To profit from the Alibaba IPO you can buy shares through a bank, with bureaucracies and high commissions attached, or our preferred method, online trading. With Plus500 you can trade on Alibaba shares from the first moments of their life on the stock exchange and then take advantage of their increases (or decreases, if you play downwards by opening positions like “sell”).