Alibaba

Alibaba Prepares to Report
http://www.bloomberg.com/news/videos/201...rose-01-27-

A revenue growth of 40% is below expectation...

(not vested)

Politics, mobile overshadow Alibaba's fairy-tale run

SAN FRANCISCO (Jan 30): Alibaba Group Holding's underwhelming holiday quarter performance and an escalating war of words with a powerful Chinese industry regulator highlight two major risks to its seemingly fairy-tale ascent: politics and the shift to mobile commerce.

The Chinese e-commerce giant has acquired a rosy aura since its record-breaking IPO last spring, revealing growth rates and volumes that dwarfed industry stalwarts Amazon.com and eBay Inc.

Now, Wall Street is cutting back on expectations in part because of fears that Chinese regulators are sharpening their scrutiny of counterfeit products on e-commerce sites, an endemic problem that Alibaba and others have fought for years.

"As the China-factor gets tempered, then excitement (around Alibaba) is going to get tempered as well," Cantor Fitzgerald's Youssef Squali said, after cutting estimates for 2015 revenue and earnings.

"At some point, you're not going to dominate the market and you're just going to grow in line with the market. But we're not there yet," he added.

The gradual migration of users to mobile platforms threatens to weigh on the top line.

On Thursday, Alibaba disappointed with 40 percent revenue growth and a monetization rate, the percentage of e-commerce transactions it earns, below Wall Street expectations.

That was due to the rising proportion of purchases on mobile devices, from which Alibaba earns less.

Its stock fell 9 percent.
...
http://www.theedgemarkets.com/sg/article...y-tale-run

a recent drop is a trap or opportunity?

Close to US$600 mil for a "minority stake" in a obscure domestic smartphone maker in China? Hmm...

Alibaba places S$798m bet on China’s smartphone market

BEIJING — Alibaba Group has agreed to invest US$590 million (S$798 million) in an obscure domestic smartphone maker as the e-commerce giant tests ways to expand its mobile operating system in a shrinking, cut-throat handset market.

Extending a previously muted push into hardware, Asia’s largest Internet company yesterday said it would buy an unspecified minority stake in Meizu Technology and integrate the smartphone’s hardware with Alibaba’s YunOS software.

Alibaba is counting on YunOS to help it grow beyond selling clothes and gadgets into the entertainment and healthcare fields, as it tries to capture a greater share of China’s 557 million smartphone users.

The deal, unlike United States rival Amazon.com’s foray into smartphones with its own-brand Fire Phone, is designed to help Alibaba push its mobile operating system within China through Meizu’s handsets. In return, Meizu will get access to Alibaba’s e-commerce sales channels and other resources.
...
http://www.todayonline.com/tech/alibaba-...one-market

There are many reasons to sell, but only one reason to buy, I guess...

Temasek holding has also reduced its Alibaba stake...

U.S. hedge funds unload Alibaba shares in fourth quarter

NEW YORK - Several of the biggest hedge fund managers slashed or dissolved their stake in China's Alibaba Group Holding Ltd at the end of last year, taking a prescient bet ahead of the company's surprise revenue miss last quarter that sent shares plunging in late January.

Among the institutional investors that dissolved their stake were Leon Cooperman's Omega Advisors, David Tepper's Appaloosa Management and Barry Rosenstein's Jana Partners LLC, according to U.S. regulatory filings released late Friday and Tuesday. Tiger Management, Moore Capital Management and Viking Global Investors LP decreased their stakes from the prior quarter, according to the filings.

Dan Loeb's Third Point and John Paulson's Paulson & Co bucked the trend, increasing their stakes in the Chinese e-commerce giant, while Tiger Global Management was also an anomaly, jumping in and taking a 5.8 million-share stake.

Soros Fund Management Group, the hedge fund firm founded by billionaire George Soros, kept its stake unchanged at 4.4 million shares.
...
http://www.todayonline.com/business/us-h...th-quarter

U.S. Law Firm Files Class Action Lawsuit against Alibaba in New York


source: http://english.caixin.com/2015-02-03/100781189.html



(Beijing) – A U.S. law firm has filed a class action complaint in New York district court against e-commerce giant Alibaba Group for allegedly violating the U.S. Securities Exchange Act.

Robbins Geller Rudman & Dowd LLP said in a January 30 statement that Alibaba used false information to mislead the public before its listing on the Nasdaq stock exchange regarding the soundness of its business operations, the strength of its financial prospects and concealing substantial regulatory scrutiny.

The law firm said the complaint alleges that Alibaba failed to disclose that its executives met with China's State Administration of Industry and Commerce (SAIC) in July, two months before its US$ 25 billion initial public offering in New York, and that regulators raised questions about "a variety of highly dubious – even illegal – business practices.

The law firm said it filed the lawsuit in U.S. District Court in New York on behalf of an Alibaba stockholder named Manishkumar Khunt.

Robbins Geller Rudman & Dowd is appealing to other investors to join the lawsuit. It did not say what compensation it is seeking.

The law firm said Alibaba's share price fell amid unusually high trading volume on January 28, the day after the SAIC published a white paper summarizing its July meeting with Alibaba executives.

Alibaba's share price fell to US$ 89.81 on January 29, down 8.78 percent from the closing price a day earlier, when it slipped 4.36 percent. The closing price on February 2 was US$ 90.13.

The SAIC, China's commerce regulator, has been locked in a high-profile war of words with Alibaba over counterfeit goods sold on the company's e-commerce websites.

The dispute started on January 27, when Alibaba publicly challenged SAIC officials over a survey that found that more than 60 percent of sampled goods on the Taobao website are "not genuine."

SAIC then released the white paper, which detailed a closed-door meeting between SAIC officials and Alibaba executives over counterfeiting and other irregularities at the company.

In an apparent attempt to defuse the crisis, the SAIC said on January 30 the document is only the minutes of a closed-door meeting and carries no legal weight.

Chen Litong, a member of All China Lawyers' Association who practices law in China and in the U.S. state of New York, said that to win class action litigation, plaintiffs must provide evidence in five criteria, such as whether defendants made false and misleading statements and if losses occurred as a result.

"The SAIC document and its subsequent elaboration seem to only serve as direct evidence that met the first criteria," he said.

The SAIC document is likely to be accepted as evidence in a U.S. court because evidence that existed before a suit is filed carries more weight that that collected in the course of litigation, Chen said.

Robbins Geller Rudman & Down LLP has 10 offices in the United States employing more than 200 litigators. It is known for its expertise in class action lawsuits involving stock trading.

I think also got another earlier one

http://www.wolfpopper.com/case.cfm/ID/114

VIE is always a concern, since Alibaba has been listed. The "risk" seems overly concerned, after the MOFCOM, in January this year. The key differentiation is who ultimately control the company. I reckon Alibaba's multi-class share structure, has ensured an ultimate control of the "Chinese core", which may not be a bad thing, as far as "VIE" risk is concern...

DJ Foreign Companies at Risk From Proposed Chinese Law

By Gregory J. Millman
Major foreign companies and several Chinese Internet companies with U.S. stock-exchange listings are using a corporate structure in China in a way that may be rendered illegal under a proposed law.

The Wall Street Journal, working with Dow Jones Risk & Compliance, identified companies that appear to be at risk from the proposed law. These include Chinese operations of Amazon.com Inc., Pearson PLC and CBS Corp. They also include three major U.S.-listed Chinese Internet companies: Sina Corp., Autohome Inc. and Weibo Corp., which are threatened because foreign investors control them. Most Chinese Internet companies listed abroad, such as Alibaba Group Holding Ltd. and Baidu Inc., also use the structure but don't seem to be at risk because they are ultimately controlled by Chinese nationals.

All these companies use a structure called a variable interest entity, or VIE, to do business in sectors of the economy where foreign investment is restricted by the Chinese government. But under the law, proposed by the Ministry of Commerce of the People's Republic of China, known as MOFCOM, in January, they may not be able to continue those operations or may have to sell controlling stakes in the operations to Chinese nationals, attorneys say.
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April 19, 2015 16:09 ET (20:09 GMT)

Copyright © 2015 Dow Jones & Company, Inc.

Source: Dow Jones

In rural areas, mobile connection is cheaper than fixed line, and more flexible. Alibaba dream in China will continue...

Alibaba, China Telecom to boost mobile commerce in rural areas

SHANGHAI — Chinese e-commerce leader Alibaba Group Holding and state-owned China Telecom Corp have tied up to sell inexpensive smartphones aimed at boosting mobile commerce in smaller cities and rural areas.

The phones, dubbed Tianyi Taobao Shopping Handsets, will come installed with either an app for easy access to Alibaba’s flagship Taobao online shopping platform or its homegrown YunOS mobile operating system, it said in a statement late on Friday.

Buyers will be eligible for four months of free 2G data service.

The partnership is an attempt to expand Alibaba’s e-commerce base in less developed parts of the country and promote its mobile operating system in a shrinking, cut-throat handset market.
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http://www.todayonline.com/tech/alibaba-...ural-areas

Next thing Taobao need to work on customer service.
Compared to Amazon, Taobao no fight.
But structurally hard for Taobao to provide excellent
no questions asked customer service. Coz PRC still Chao
Kuan and 不够文明。