Date
18 October 2018
Alibaba chief executive Jonathan Lu says the group hopes to return to Hong Kong at the right time while its plan to list in New York is not yet final.
Alibaba chief executive Jonathan Lu says the group hopes to return to Hong Kong at the right time while its plan to list in New York is not yet final.

Hong Kong bourse remains top priority for Alibaba’s listing plan

E-commerce giant Alibaba Group said Hong Kong remains its preferred destination for an initial public offering, although it has reportedly secured informal approval to list in New York. 

For the moment, the company does not consider getting listed an urgent matter, and it wants the controversy over its difference of opinion with the Hong Kong regulators to cool down first, the group’s chief executive Jonathan Lu told Hong Kong media in Hangzhou on Thursday.

“Hong Kong has always been favored by Alibaba and we wish to get listed in Hong Kong if there is any chance,” said Shao Xiao Feng, the group’s chief risk officer and secretary general.

Lu also repeated what president Jack Ma said when Alibaba delisted from Hong Kong stock exchange in 2008 that “we will come back and hope to return to Hong Kong at the right time”.

“But we might hold it off at this point as both of us need time to cool down,” Lu said, adding that the company is not rushing to go public.

Alibaba had applied to list in Hong Kong but was rejected by regulators because of its proposed partnership structure. The structure has been accepted by the New York Stock Exchange and the NASDAQ Stock Exchange, news portal Sina.com reported on Oct. 20, citing a spokesperson for Alibaba. 

NASDAQ is honored to have Alibaba listed on its board, Dow Jones reported Wednesday, citing chief executive Bob Greifeld. He declined to comment whether he has personally met with Alibaba executives on the proposed listing, the report said.

Regardless of whether it will go public and where it will list, the company hopes the public can understand its real demand and its proposed partnership structure, which can provide a culture of open, innovative, responsible and sustainable development, Alibaba said in a statement on Thursday.

“We paid the price, we learnt a lesson [in Hong Kong] and we are going forward,” Zeng Ming, the group’s chief strategy officer, said in response to queries about the listing. Lu added that the US listing plan has yet to be finalized while a recent meeting of Alibaba executives with London officials was just a courtesy call.

The South China Morning Post, citing an unnamed with knowledge of the matter, reported on Oct. 22 that Alibaba is considering a London listing as part of its potential US$15 billion share sale plan. Senior executives of the group met British officials during last week’s visit to Hong Kong by London Mayor Boris Johnson, it said.

Business target

The company is optimistic on the e-commerce business outlook as “the business is just a start and would not be a problem for Alibaba’s business to sustain for at least one to two decades,” Zeng said.

Taobao.com, Alibaba’s online shopping site, has achieved last year’s turnover of 1.1 trillion yuan (US$180.82 million) in the first eight months this year, Lu said. He said the platform’s turnover this year would reach 1.5 trillion yuan to 1.6 trillion yuan.

Within the next three years, Taobao is going to achieve 3 trillion yuan in transaction amount, surpassing Wal-Mart Stores Inc.’s record, Lu said.

Ma proposed last year to launch a “double million mechanism” target, which refers to “one million sellers accomplishing one million yuan of annul sales”.

Lu believes it can be achieved over the next three to five years and the company will grant more resources to those small and medium sellers to reach the target.

For T-mall.com, “we are working hard to keep daily turnover below 30 billion yuan this coming Nov. 11 [Singles Day in China] to avoid an overloading of the logistics segment,” Lu said. This compares with the 19.1 billion yuan achieved on the same day last year.

– Contact the reporter at [email protected]

JP/CG

Ayishah Ma is a financial reporter on Greater China issues.

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