After two years, Alibaba finally achieved dual major listings on the Hong Kong Stock Exchange and the New York Stock Exchange.
On August 28th, Alibaba Group announced the official completion of its dual primary listing, and the "S" representing the second listing in its Hong Kong stock symbol was removed from its stock abbreviations on the Hong Kong and RMB counters. As of the close of the day, Alibaba closed at HKD 79.1, down 1.06%, with a total market value of HKD 1.53 trillion.
From secondary listing to dual primary listing, Alibaba continues to shift its capital market focus back. But in the past two years, not only Alibaba itself, but also the entire investment environment has changed from yesterday. Can Alibaba still achieve its original goals?
Return to Hong Kong for main listing
Alibaba's previous trading mechanism in the Hong Kong capital market was a secondary listing.
According to a reporter from Huaxia Times, Alibaba's B2B business was listed on the Hong Kong Stock Exchange in 2007. In 2014, when Alibaba considered going public as a whole, its first choice was Hong Kong. However, due to relevant regulations and restrictions, the company ultimately switched to the United States for listing. After the launch of the listing system reform by the Hong Kong Stock Exchange in 2018, Alibaba went public for the second time in Hong Kong in November 2019, with the New York Stock Exchange remaining its main listing location. In July 2022, Alibaba submitted an application to become primarily listed in Hong Kong.
An industry insider told reporters that the regulatory requirements for secondary listing are relatively simple, and the listing cost is also low. The stock prices of the two places are closely related, while the regulatory requirements for dual primary listing are strict, and the stock price performance of the two places is relatively independent. Another important difference is that secondary listed stocks are not eligible for inclusion in the Hong Kong Stock Connect, while primary listed stocks that meet relevant rules can enter.
Senior investment banker Wang Jiyue believes that Alibaba's transformation of Hong Kong into the main listing location is mainly based on considerations of the two markets. The current focus of the US capital market is on a few US technology stocks represented by NVIDIA. Alibaba's attention is too low, while in Hong Kong it is a leading company.
In terms of market value, Tencent, with a total market value exceeding HKD 3 trillion, currently ranks first in the Hong Kong stock market. Alibaba ranks third in the Hong Kong stock market after China Mobile with a gap of HKD 0.09 trillion.
Wang Jiyue also told reporters from Huaxia Times that the United States is about to enter a cycle of interest rate cuts, capital may flow out of the United States, the US capital market may be volatile, and Hong Kong may be a capital inflow destination.
In addition, as the second largest market capitalization company in the Hong Kong stock market, attracting mainland investors who understand it better is an important reason for Alibaba to transform Hong Kong into its main listing location.
According to the reporter's understanding, since Alibaba's second listing in Hong Kong in 2019, most of its publicly traded shares have been transferred to Hong Kong. In terms of market value and trading volume, Alibaba has always been among the top in Hong Kong stocks. On August 28th, as of press time, Alibaba's Hong Kong stock turnover was HKD 2.761 billion, ranking third after Tencent and Meituan.
According to institutional research reports, the market widely expects Alibaba to meet the conditions for inclusion in the Hong Kong Stock Connect after completing its dual major listing in Hong Kong, and is expected to be included as early as September. Among them, Morgan Stanley predicts in its research report that after being included in the Hong Kong Stock Connect, the proportion of southbound capital holdings may remain stable at over 10% in the long run, which is expected to provide significant incremental support for the company's value.
Kuang Yuqing, founder of Lens Research, also told reporters from Huaxia Times that Alibaba's dual listing on the US and Hong Kong stocks is mainly to diversify risks and provide possibilities for valuation repair. He believes that the current environment is only a short-term factor, and when the market recovers in the future, opportunities will arise. "Valuation repair will not be a short-term process, there will be a long-term process
When will the stock price rebound
Behind the hope of attracting more southbound capital, Alibaba's stock price has shrunk by nearly 30% compared to two years ago.
In July 2022, when Alibaba proposed to transition to a major listing in Hong Kong, its stock price was around HKD 107 and its total market value exceeded HKD 2 trillion. But based on the rough calculation of the closing price on August 28th, it has shrunk by 26% compared to July two years ago.
In fact, two years ago was not Alibaba's most dazzling moment in the Hong Kong capital market. In November 2019, Alibaba returned to the Hong Kong stock market with an issue price of HKD 176, and in December of that year, it crossed the HKD 200 mark. At the end of October 2020, Alibaba's stock price surged to a historical high of HKD 309.4, but then a downward channel opened.
Faced with a decline in stock prices, Alibaba has also initiated long-term share repurchases. In Q1 of the 2025 fiscal year ending at the end of June this year, Alibaba repurchased $5.8 billion worth of shares, which Alibaba CFO Xu Hong referred to as "surpassing the strength of the past few quarters". Throughout the 2024 fiscal year, Alibaba repurchased $12.5 billion worth of shares.
Not only the capital market, but Alibaba itself has also undergone significant changes. Last year alone, Alibaba experienced the largest "1+6+N" spin off in history, as well as the turnover of its top management. Previously active business spin offs and IPOs were subsequently put on hold.
Behind the many changes, the most direct stimulus to the capital market is still the seemingly "never-ending" growth space of a company. This is also an important reason why Alibaba's current CEO, Wu Yongming, has repeatedly emphasized that the highest priority for the group is to reignite the growth momentum of its two core businesses, e-commerce and cloud computing.
Among them, e-commerce is Alibaba's core business, and Chinese retail business is its cornerstone business. However, in the Q1 of the 2025 fiscal year, which had a major promotion in 618, both the revenue and adjusted EBITA of Taobao Group decreased by 1% year-on-year. It should be mentioned that the current revenue of China's retail business, which accounts for over 95% of Taobao's revenue, decreased by 2% year-on-year.
However, another core business, Alibaba Cloud, has grown rapidly in the current period. In the Q1 fiscal quarter, Alibaba Cloud's revenue of 26.55 billion yuan increased by 6% year-on-year, and its adjusted EBITA of 2.337 billion yuan increased by 155% year-on-year. As a comparison, the growth rates of these two indicators in the previous quarter were 3% and 45%, respectively.
Compared to the fierce competition in the existing e-commerce market, the fiercely competitive but larger scale B2B market may be a prescription for Alibaba's valuation to rebound.