Reckoning day has arrived for Alibaba -- the ecommerce giant of the East, whose record-setting IPO marks the largest stateside offering of all time. And as expected, the company is whipping up a Wall Street frenzy.
Priced at $68 yesterday, shares opened at $92.70 when trading kicked off in New York this morning. That marks an increase of roughly 36 percent. Due to order imbalances, trading for BABA -- the company’s ticker name on the NYSE -- opened at 11:53 a.m. ET, more than two hours late.
As of 2:35 p.m. ET, shares were hovering around the open price and had climbed as high as $99.70.
Initially valued at $168 billion, Alibaba’s market cap soared to $228 billion on Friday -- meaning that, comparatively speaking, the company is now more valuable than some of the most ubiquitous names in tech, including Verizon ($206 billion), Facebook ($199 billion) and Amazon ($151 billion).
Initial pricing raised a total of $21.8 billion for the company yesterday, easily surpassing the $16 billion raised by Facebook when it went public in 2012. It also tops the funds raised by Visa ($19.7 billion) and General Motors ($18.2 billion) in their respective offerings.
However, given frenzied demand, Alibaba’s underwriters could release additional shares on top of the 320.1 million that were initially offered, according to . This means that the company could ultimately raise as much as $25 billion, shattering a world record currently held by the Agricultural Bank of China ($22.1 billion).
But just why are American investors going gaga for BABA? The multi-pronged company, founded in 1999 by former high school English teacher Jack Ma, dominates China’s ecommerce market with a host of services that are comparable to Amazon, eBay and PayPal.
Some of its most popular products include online marketplaces Taobao and Tmall, as well as the digital payment provider Alipay.
And its vast user base within one of the world’s most promising markets is matched by huge profits -- a feat that many buzzy tech companies can’t claim to deliver. In its last fiscal year, the company reported annual revenues of $8.5 billion.