The Alibaba IPO hype had all the trimming of Internet Fever of the end of the 90s.    As soon as Alibaba released its prospectus in October the issue was oversubscribed.  The excitement surrounding Alibaba had even an effect on other players in the market.   Incredibly, several media outlets also reported that demand for Alibaba shares was also pushing up the Hong Kong dollar as international investors converted into the local currency in order to buy shares.  The share price of tripled on its opening day on the Hong Kong stock market from HK$13.50 to $39.95. At its peak price for the week, HK$40.50, the company was valued by the market at over US$26 billion; some 300 times projected 2007 earnings.  After the initial run-up in its shares, the market value of Alibaba stood at 146 times earning based on its projections for 2008.  One would have thought after the first Internet bubble such figures would indeed belong in the land of fairy tales.  Will it last?  (52 wk range HK$27.00 – HK$ 42.50. It closed on Nov. 23rd at HK$ 34.45)     Source:  Business Strategies Group /

BIIA Newsletter November – 2007 Issue