Alpha Resource Partners - Alibaba's imminent IPO could adversely affect the fortunes of its Chinese technology peers.
China., June 25, 2014 - (PressReleasePoint) - Alpha Resource Partners have reported that, although the impending stock market debut of Chinese internet giant, Alibaba is expected to pin a price tag of $168 billion on the company, it could potentially adversely affect the fortunes of its Chinese peers with stocks listed on US stock exchanges.
"Concerns are mounting that investors could sell part of their holdings in the top 35 China-based, US-listed technology companies in order to free up funds to take advantage of the potential in the Alibaba offering," said an Alpha Resource Partners researcher.
The preliminary valuation of Alibaba is only 15% less than the combined valuation of the top 35 Chinese IT companies listed on US exchanges and potentially ranks the listing as the largest ever US IPO.
The company that ex-English teacher, Jack Ma established 15 years ago from his condo has grown to the point where it facilitates more business transactions across its numerous platforms than American e-commerce giants Amazon.com and eBay combined.
"More conscientious portfolio managers may be asked to sell some holdings to buy Alibaba if they believe the offer price is attractive," said the Alpha Resource Partners researcher after an index of Chinese dotcom companies shed 15% over the preceding two months.
The firm says it expects the Alibaba IPO to be over-subscribed owing to the dominant position the company holds within the world's largest internet market.
"The enthusiasm for this IPO has its roots in the still-developing e-commerce market in China. With 1.4 billion people and only a relatively small portion of those shopping online, Alibaba still has plenty of room to grow," explained the Alpha Resource Partners researcher.
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