The Web company that counts Cisco Systems Inc. and Yahoo! Inc. as shareholders rose to HK$33.00 from the offer price of HK$13.50 as of 11:44 a.m., valuing the Hangzhou, eastern China- based company at about $21.5 billion.
Alibaba, China's largest online trading site for companies, predicts profit will triple this year on increased spending to market goods and services in the world's fastest growing major economy. Today's gain underscores demand for shares of Chinese companies, a day after PetroChina Co. became the world's first $1 trillion company on its Shanghai trading debut.
``This company is coming along with good growth expectations,'' said Gabriel Gondard, who manages about $10 billion at Societe Generale venture Fortune SGAM Fund Management Co. in Shanghai. ``It's an area where the Chinese market isn't saturated,'' he said before trading started today.
The IPO price valued Alibaba at almost 66 times its projected 2008 earnings as estimated by the investment banks arranging the sale.
That compares with about 56 times for Tencent Holdings Ltd., operator of China's most popular Internet chat service, and about 117 times for Baidu.com Inc., according to data compiled by Bloomberg. Beijing-based Baidu is the provider of the country's most-used Internet search engine. "
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