It's the LAST DAY to donate and pick up any of our thank-you gifts at a discount. 🔥 Give Now!

Investors believe Alibaba will fly

Scott Tong Nov 6, 2007
HTML EMBED:
COPY

Investors believe Alibaba will fly

Scott Tong Nov 6, 2007
HTML EMBED:
COPY

TEXT OF STORY

Scott Jagow: Ho hum, another day, another massive Chinese IPO.
Yesterday, it was PetroChina in Shanghai. Today, the e-commerce firm Alibaba went public in Hong Kong. Marketplace’s Scott Tong reports.


Scott Tong: Think of Alibaba as the online dating service for global business. The world’s most popular B2B — or business-to-business — website connects Chinese manufacturers with buyers around the world.

Alibaba investors predict a magic carpet ride into China’s digital future. And consider these numbers: China has 160 million Internet users — average age, a youthful 32 — and the online advertising market grows 45 percent every year.

Now the “however:” Remember what dot-com and IPO brought America in the 90’s? Alibaba’s price-to-earnings ratio — based on today’s closing price — is a whopping 320.

Another risk is that foreign buyers will continue to sour on Chinese exports for perceived quality or safety reasons. And Alibaba is at the heart of the “Made in China” supply chain.

In Shanghai, I’m Scott Tong for Marketplace.

There’s a lot happening in the world.  Through it all, Marketplace is here for you. 

You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible. 

Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.