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Markets· Equity

Alibaba stock pops 7% in HK debut, largest cap stock in HKEx

CKN
minutes 2019/11/26 04:08:59
3,416
Alibaba, IPO, HKEx, E-commerce

Nov 26, 2019 (China Knowledge) - Today, after seven years, Alibaba returned to HKEx again with the stock code of 9988. Alibaba’s share price opened at HKD 187, up 6.25% from its initial price of HKD 176 making its market capitalization surpassing Tencent's to reach HKD 4 trillion, to become largest market capitalization in the Special Administration Area (SAR).

According to the prospectus, the funds raised by Alibaba's IPO will mainly be used to drive users’ growth and increase participation, help enterprises realize digital transformation, improve operation efficiency and continue innovation.

In terms of equity structure, Softbank holds 25.8% of its total shares, Ma Yun 6.1%, Cai Chongxin 2.0%, other senior managers 0.9% and public shareholders at 65.2%.

It is reported that in 2007, Alibaba.com Ltd. (B2B business) was once listed in HKEx. But 5 years after listing in 2012, Alibaba announced privatization and completed delisting from the exchange. The next year, Alibaba once again returned to HK to seek the overall listing of the group, but the structure of weighted voting rights proposed by Alibaba was inconsistent with the mechanism of the HKEx. Therefore, the application was called off.

After dropping its group’s listing, Alibaba Group formally listed on the NYSE in 2014 due to its adherence to its weighted voting rights. However, on the first day of IPO in the US, Alibaba promised to come back to HK as long as conditions permit.

Last April, HK market ushered in the most significant listing mechanism reform in nearly 25 years, and no longer tangled with weighted voting rights. This allows Alibaba to list once again in HKEx, with strong investors’ demand building up 40 times oversubscription and boosting today’s stock at over 7% on opening trading hours.

It is also noted that Alibaba directly controls three companies in HKEx, namely ALI HEALTH (00241. HK), ALI PICTURES (01060. HK), AGTECH HOLDINGS (08279. HK), and eight related companies, including SUNART RETAIL (06808. HK), which are directly or indirectly owned by Alibaba.

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