The IPO revolution

Grainne 2

Although the Company is not known to many in the West, the Alibaba initial public offering (IPO) has to be one of the world’s most anticipated IPO in recent years. This is not just because it is set to become the largest IPO ever, but also that demand is so great the Asian e-Commerce giants have increased the share price offering from $60 to $68 and are preparing to close the books early as they reach their fund target of $21.8 billion.

Even at the higher offering price, it is still significantly lower than their Chinese Internet peers, which is positive news for investors as it could mean the share price will rise as soon as they become listed, on 19th September.

The Alibaba chain essentially provides an eBay, PayPal, Amazon service across Asia, with 279 million online customers who collectively spend $300 billion across the sites. The Company intends to use the funds raised from the IPO to develop further in the US and Europe, making them a significant player in the global online and mobile community and serious competition for the likes of Amazon.

The Alibaba IPO has contributed to figures from the US and London Stock Exchange who have confirmed that IPOs, especially in the biotech industry, have hit highs worth £18.5 billion, which have not been seen since 2007.

This is a good sign for stock markets and companies, who can potentially benefit from growth and increased market share, and investors as it offers wider choice of investment.