Alibaba to hold Yahoo HK $776 million

Alibaba, nicknamed "Hong Kong's version of PetroChina," 01688,hk a new low of HK $9.63, the first time the company has closed below HK $10 in its 8-month IPO. Alibaba's shares fell 77% from the top price of HK $41.80 to the end of last year, down 29% per cent from their IPO prices. Yahoo has subscribed to a HK $776 million IPO when Alibaba listed, which means Yahoo has lost HK $225 million.

　　8 Big institutions floating loss 676 million

November 6, 2007, Alibaba officially landed on the Hong Kong exchange, the first day of the stock market crazy 192.59%, became the most profitable IPO on the day. Then, every time in the newspaper and magazine to see "Alibaba" four words, always preceded by the "biggest market capitalisation internet company", "Hong Kong IPO King" and other laudatory name, and Alibaba stock price in early December amounted to HK $41.8, market value of more than 210 billion Hong Kong dollars.

However, in the overall weakness of the Hong Kong stock market, the sponsors sang empty Alibaba also began to fade the halo of the new shares king. March 18 This year, the miserable 4-month Alibaba plate below the 13.50 Hong Kong dollar Price, the IPO Wang Alibaba began to be dubbed "Hong Kong version of PetroChina." To close yesterday, Alibaba market value of 48.6 billion Hong Kong dollar, 8 months time, more than 160 billion market value was evaporated.

Alibaba's listing included 8 strategic investors, including Yahoo, which subscribed for HK $776 million, and Foxconn, the chairman of AIG and Hon Hai, subscribed to HK $271.6 million, chairman of the Hong Kong Kowloon Warehouse (00004,HK) Mr Peter Woo, Sun Hung Kai Property ( 00016,HK) The Kwok family and Regal Guo Henian invested 232.8 million Hong Kong dollars respectively in the IPO, while the Nasdaq-listed companies Ciscosystems and ICBC Asia also subscribed to Alibaba, HK $155.2 million respectively. The lock-up period for 8 strategic investors was two years and the holdings were lifted by November 2009.

By yesterday, Alibaba had fallen by 29% per cent from its IPO price, meaning that the strategic investors who subscribed to HK $2.328 billion in total had lost HK $676 million, with Yahoo, the biggest subscription share, losing HK $225 million. Although it is already a deep set, but last year Alibaba broke 40 Hong Kong dollar, the 8 big investors of the book profit also close to HK $5 billion.

　　The old sponsor "the coldness"

Goldman Sachs, once one of the company's IPO sponsors, blew the cold again yesterday. The company's 2009 forecast price-earnings ratio was lowered from 30 times to 28 times, with target prices down from HK $15 to 20% to HK $12, while investment ratings remained "neutral".

Goldman Sachs said in its report that challenges from the macro-economic level, such as rising wages and costs, tighter credit, stronger renminbi and slower exports, would have more impact on Alibaba's goldsupplier membership and its new signing membership than the bank's expectations. In addition, Alibaba in the first quarter to restructure the sales force is poor, so the two-quarter Goldsupplier member net growth is expected to be reduced from 2,300 to 1200, the whole year from 10,500 to 7,700. Goldman Sachs estimates that goldsupplier membership fees account for more than half of Alibaba's total income. The bank also cut Alibaba's earnings forecasts for 2008 to 2010 by 3%, 12% and 13%, to HK $0.33, HK $0.45 and HK $0.64 respectively.

Interestingly, Alibaba's sponsors are all very "selfless". December 6, 2007, Alibaba listed "Full Moon", the IPO of the two major sponsors Deutsche Bank and Goldman Sachs in the same day, the report of the study of Alibaba, respectively, the "sell" and "sell" the initial rating, The target price was HK $26.70 and HK $30 respectively, while Alibaba closed at HK $37.20 a day before. The two major sponsors of the same time to blow, Alibaba in December 6, the day plunged 12%.

It is not just Goldman that has been a cold shoulder to Alibaba, and CLSA has lowered its target price to HK $12 by July 7. The bank said that while Alibaba's share price had been significantly reversed, it still had 28 times times the 2009-year forecast P/E ratio (which is expected to be 4.101 billion in 2009), so it maintained its "run away" rating for the unit.