- Ant raises about $34.5 billion to value the company at $312 billion in the biggest IPO ever
- Shares of Alibaba closed 0.98% lower yesterday after logging a new all-time high at $315.46
- A pullback to the $300 area is likely to be seen as an opportunity to buy BABA and target $320
Shares of Alibaba (NYSE: BABA) logged fresh record highs as Ant Group, which is controlled by Alibaba, recorded the world’s largest IPO ever.
Fundamental analysis: Record IPO amid strong demand
Ant Group, the Chinese tech giant, is set to close its initial public offering (IPO) to investors a day earlier than previously planned amid strong demand. This way, the book-building process in Hong Kong will close at 5 p.m. local time on Wednesday, 24 hours earlier than planned.
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“It was like the flood gates just opened,” persons with knowledge of the situation told Nikkei Asia. “Investors’ appetite has been overwhelming. Orders keep pouring in.”
Ant Group decided to list its shares in both Shanghai and Hong Kong to raise about $34.5 billion and value the company at $312 billion. The fintech firm will see its shares go public on November 05.
The IPO previously received a green light from both the China Securities Regulatory Commission and the Hong Kong Stock Exchange. Alibaba said it will purchase 730 million A-shares through its subsidiary Zhejiang Tmall Technology to uphold its 33% stake.
In the first nine months of this year, the number of its active Alipay users rose 711 million in June to 731 million in September. Moreover, revenue rose about 42% to 118.19 billion yuan ($17.73 billion) compared to a year ago.
Technical analysis: New all-time high posted
Alibaba stock price closed 0.98% lower yesterday despite logging the new all-time high at $315.46 earlier in the session. Still, the buyers are pushing higher today on positive news related to Ant’s IPO.
A deeper pullback to the $300 area is likely to be seen as an opportunity to buy Alibaba shares. This zone hosts the previous all-time high, set in August, and will now act as strong support. On the upside, the next target is $320.
Summary
Ant Group has been forced to close its IPO a day earlier amid strong demand for its shares. The fintech firm, in which Alibaba holds a 33% stake, recorded the biggest ever IPO.
