Alibaba shares are up 5% today – here’s why
Investors have reacted positively to a major announcement from Chinese e-commerce giant Alibaba.
The company has revealed it’s applying for a primary listing on the Hong Kong Stock exchange, meaning it would become a dual-primary listed company on the New York Stock Exchange.
“We have received approval from the Board to apply to add Hong Kong as another primary listing venue, in the hopes of fostering a wider and more diversified investor base to share in Alibaba’s growth and future, especially from China and other markets in Asia,” said Alibaba Group Chairman and Chief Executive Officer Daniel Zhang.
“Hong Kong and New York are both major global financial centers, with shared characteristics of openness and diversity.
“Hong Kong is also the launch pad for Alibaba’s globalization strategy, and we are fully confident in China’s economy and future.”
Alibaba says it expects the primary listing process to happen at the end of 2022.
Meanwhile, Alibaba’s Chief Executive Officer, Daniel Zhang, has told shareholders the company has been “deeply impacted” by “tremendous uncertainties”, including the Covid-19 pandemic, the new expectations of the Internet sector in China, and high frequency of international geopolitical conflicts.
“This may be the year in which changes in the external environment has been most severe in decades,” Zhang said.
However, he also went on to list some of the company’s achievements, pointing out that during the past fiscal year, the company achieved its goal of serving more than 1 billion annual active consumers in China.
Zhang also said the company has been determined its focus its technology strategy around cloud computing.
“By 2025, the size of China’s cloud computing market is expected to reach RMB1 trillion, which is three times the size of the current market and speaks to the massive market potential,” he said.
“To capture this historical opportunity where every sector and industry is going digital, we need to continue to build our technology and product capabilities, and fully integrate the basic infrastructure of cloud computing with big data and artificial intelligence.”