Chinese e-commerce giant Alibaba’s sales hit the record of US$24.3 billion in the world’s biggest ever mid-day sale on Sunday during annual online shopping fiesta. The mid-day sales of ecommerce giant of China is much higher than annual exports of Pakistan which have gradually fallen from $25 billion a year a few years ago to around $22 billion.
Various platforms of Alibaba Group broke the 10 billion yuan (US$1.44 billion) sales within first two minutes as the ecommerce giant launched the 10th year of its iconic Double 11 shopping gala. Last year Alibaba group surpassed the single day sale record with more than eight hours to go before end of its 24-hour shopping festival that strengthened its position as the world’s biggest retail event and assuaging concerns that Chinese consumer sentiments is softening. Similarly, within half an hour of single day, 30 brands including Nike, Adidas, Uniqlo, Procter & Gamble, Ziaomi and Apple crossed 100 million yuan in sales. In just one second, 3,700 single’s day special edition MAC lipsticks were sold out.
In addition to this, Alibaba Group expects to price its initial public offering (IPO) at between US$60 and US$66 a share, it said in a filing to the US Securities and Exchange Commission.
It will sell more than 320 million American depositary shares (ADS) – meaning it could raise US$21.1 billion at the top end of the price range.
The underwriters have the right to purchase 48 million additional shares, which could take the total to US$24.3 billion. That would value the company at about US$163 billion.
Even if Alibaba is eventually priced at the bottom end of the range, and the option for additional shares is not exercised, it could raise at least US$19.2 billion – surpassing Visa, which raised US$17.9 billion in 2008 to become the largest IPO in the US.
Priced at the top end, and with the additional shares sold, it could beat the record US$22.1 billion raised in 2010 by Agricultural Bank of China.
Alibaba is expected to conduct IPO roadshows in Hong Kong, New York and San Francisco in the coming two weeks.
Ricky Lai, an analyst at Guotai Junan International, said Alibaba’s price range was about 13 per cent lower than expected. He attributed that to recent negative news about the company.
The company last month said it was selling its small-business lending arm to the parent company of Alipay, Small and Micro Financial Services. The move was seen as a bid to reduce exposure to loan risks ahead of the IPO.
“Alibaba has been the focus of the market. Its robust growth is expected to continue,” said Lai. “However, there has been some negative news recently. For example, China may impose a tax on online shopping.”
Chinese media reported last month that the State Administration of Taxation was studying a plan to bring in a tax on online stores. The move would have a huge impact on Alibaba’s Taobao – one of the most popular customer-to-customer platforms in China.