A First Look At Alibaba’s IPO Roadshow

Alibaba Group launched the roadshow for its $24 billion initial public offering in New York on Monday (Sept. 8). But although China’s e-commerce giant has updated its IPO filing six times since May, there are still unanswered questions, according to a Wall Street Journal blog.

Among them:

* How does Alibaba benefit from the billions of dollars in acquisitions the company has made in the past year? One standout example: $190 million for a 50 percent stake in China’s Guangzhou Evergrande soccer team.

* How will Alibaba’s Alipay payment system fight off competition from Alibaba rival Tencent, whose chat app WeChat has 400 million users and is integrating e-commerce and mobile payments into its capabilities?

* Will Alibaba be able to maintain its market strength and profitability as users shift to mobile devices? Alibaba’s main source of revenue is advertising fees paid by merchants using its marketplaces, but ad services for mobile apps aren’t yet proving as lucrative for Alibaba as those on PCs, and investor concerns about the shift to mobile caused problems for Facebook’s $16 billion IPO in 2012.

* How big can Alibaba get? With transaction volume that is already larger than eBay and combined, some investors question whether Alibaba can continue to grow. The answer may depend on Alipay, which processes transactions and also offers small-business loans, and an Alibaba a money-market fund that was recently China’s largest.


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