BABA - Alibaba Group Holding Limited

NYSE - Nasdaq Real Time Price. Currency in USD
176.47
+2.47 (+1.42%)
As of 2:09PM EDT. Market open.
Stock chart is not supported by your current browser
Previous Close174.00
Open175.39
Bid177.04 x 1000
Ask177.04 x 800
Day's Range174.85 - 177.56
52 Week Range129.77 - 198.35
Volume12,465,618
Avg. Volume19,917,095
Market Cap459.44B
Beta (3Y Monthly)1.84
PE Ratio (TTM)50.46
EPS (TTM)3.50
Earnings DateAug 21, 2019 - Aug 26, 2019
Forward Dividend & YieldN/A (N/A)
Ex-Dividend DateN/A
1y Target Est217.88
Trade prices are not sourced from all markets
  • Alibaba takes on Amazon in a $1.8 trillion US market
    Yahoo Finance5 hours ago

    Alibaba takes on Amazon in a $1.8 trillion US market

    The trade tension between Washington and Beijing hasn't stopped the Chinese tech giant's ambitious plans for the U.S. market.

  • Reuters18 minutes ago

    UPDATE 1-Alibaba welcomes U.S. small businesses to sell globally on its platform

    Chinese e-commerce giant Alibaba Group Holdings Ltd will allow small U.S. businesses to sell on Alibaba.com, the company said on Tuesday, as it seeks to tap into the business-to-business e-commerce market and fend off rivals like Amazon.com Inc. The change will open up markets to U.S. merchants in countries served by Alibaba, including India, Brazil and Canada. U.S. merchants, previously able to only buy on Alibaba.com, can now also sell to other U.S.-based businesses on the marketplace.

  • Barrons.com53 minutes ago

    Wall Street Has High Hopes for Alibaba’s Earnings. Analyst Argues the Bulls’ Case.

    The average forecast among analysts who track the stock is for earnings for the quarter that ended in June to rise 28% from a year earlier.

  • Alibaba Opens Business-To-Business Platform To U.S. Companies
    Investor's Business Daily2 hours ago

    Alibaba Opens Business-To-Business Platform To U.S. Companies

    Alibaba stock rose Tuesday as the China e-commerce giant said it will allow U.S. merchants to engage in global business-to-business transactions on its platform for the first time.

  • Benzinga3 hours ago

    Alibaba Opens B2B Platform To American Small Businesses

    Alibaba opened its e-commerce network to nearly 30 million small and medium-sized U.S.-based businesses Tuesday, including manufacturers, wholesalers and distributors, the company said in a press release. Alibaba said it will host the first of many "Build Up" workshops and webinars Tuesday with local chambers of commerce.

  • Amazon's (AMZN) AWS Momentum to Drive Growth in Q2 Earnings
    Zacks4 hours ago

    Amazon's (AMZN) AWS Momentum to Drive Growth in Q2 Earnings

    Amazon's (AMZN) second-quarter results are expected to benefit from expanding AWS services portfolio and customer base.

  • Market Realist4 hours ago

    Etsy Expands to New Vertical with Reverb Acquisition

    Etsy (ETSY) stock price edged higher on the confirmation that the company is expanding into a new vertical.

  • XOMETRY Announces Partnership with Alibaba.com as a Co-Marketing Sponsor to Help U.S. Small Businesses Sell Locally and Globally
    PR Newswire4 hours ago

    XOMETRY Announces Partnership with Alibaba.com as a Co-Marketing Sponsor to Help U.S. Small Businesses Sell Locally and Globally

    GAITHERSBURG, Md. , July 23, 2019 /PRNewswire/ -- Xometry, the largest on-demand manufacturing marketplace, today announced it is joining Alibaba.com's U.S. B2B ecosystem as a Co-Marketing Sponsor. Alibaba.com, ...

  • TheStreet.com4 hours ago

    [video]Alibaba Group Unveils U.S. B2B Platform

    Alibaba Group opened one of its e-commerce platforms to allow U.S. businesses to sell their products to Alibaba.com buyers in the U.S. and around the world.

  • How Britain’s Savviest Investors Are Beating Brexit
    Bloomberg5 hours ago

    How Britain’s Savviest Investors Are Beating Brexit

    (Bloomberg Opinion) -- Since the U.K. decided more than three years ago to leave the European Union, the nation's savviest investors have succeeded by putting their money where Brexit matters least.Uncertainty about the date of Britain’s departure (now pushed back to Oct. 31) and the terms of the divorce has meant purging the U.K. from their holdings or limiting them to investments traditionally impervious to man-made and natural disasters. Over 38 months, British sterling depreciated 16 percent, the worst shrinkage for any similar period in 8 years. The pound remains the poorest performer in the actively-traded foreign exchange market and inferior to the No. 3 euro.Europe's strongest major economy in the 21st century became a shadow of its former self, reversing two decades preceding the June 23, 2016 referendum when the U.K. outperformed the European Union in growth and investment. London's stock and bond markets similarly languished as laggards to world benchmarks, after beating them consistently in the 20 years prior to the decision to leave the EU, according to data compiled by Bloomberg.“If I give myself some credit, I would say that we acted reasonably fast liquidating U.K. shares” in 2016, said Ben Rogoff, whose Polar Capital Technology Trust PLC has been the most consistent winner out of the 212 British global funds with at least 1 billion pounds this year and during the past three years. His team's 114 percent total return (income plus appreciation) was 22 percentage points better than the Dow Jones World Technology Index, mostly because 68% of the fund is invested in the U.S., two-thirds of that in California companies, according to data compiled by Bloomberg. “It's all about the Internet and where do you get exposed to the Internet? The U.S. and China,” Rogoff said last month during an interview at Bloomberg in London.While Rogoff reduced his holdings of three California tech powers during the past year — Cupertino-based Apple Inc., Menlo Park-based Facebook and Santa Clara-based Advanced Micro Devices — he acquired more shares in Shenzhen-based Tencent Holdings Ltd., Hangzhou-based Alibaba Group Holding Ltd., South Korea's Samsung Electronics Co. and Tokyo-based Yahoo Japan Corp., according to data compiled by Bloomberg.The 46-year-old graduate of St. Catherine's College, Oxford, became the lead manager of the trust in 2006, “and at that time,” he said, “the U.K. weighting might have been 5% to 10%, so if you had already been backing away to the door, it's a lot easier to escape than if you built a career around being an expert in U.K. equities.” Since the Brexit referendum, he said, “There's just been a complete buyers' strike of U.K. equities.”Proof of such disdain comes with the crisis this year at the LF Woodford Equity Income Fund, Britain's most-prized investment when it was launched by star money manager Neil Woodford in 2014. The celebrated stock picker became even more prominent with his contrarian bullish stance on Brexit. The fund plummeted 31% during the past two years by holding a combination of large and small U.K. companies and has frozen redemptions indefinitely.“It's symptomatic of a broader problem,” Bank of England Governor Mark Carney told reporters earlier this month. “Our sense is that the financial-stability risks are increasing.”One U.K. investor who’s successfully resisted the trend away from domestic stocks is Nick Train, who manages Finsbury Growth & Income Trust. It returned 61% the past three years — more than twice the FTSE All-Share Index benchmark — as the most consistent one- and three-year performer among the 129 U.K.-based funds investing mostly in domestic stocks or bonds, according to data compiled by Bloomberg. Unlike Woodford, who doubled down on the British economy writ large, Train, a 60-year-old graduate of Queen’s College, Oxford, dramatically increased his holdings in consumer staples. These are the companies that make such essentials as food, beverages and household goods and can resist business cycles because their products always are in demand.Train, who declined to be interviewed, increased the consumer staples weighting relative to the benchmark to 27% from 23% in 2015 and he enhanced his holdings of Deerfield, Illinois-based Mondelez International Inc., which manufactures and markets packaged food products, and London-based Diageo PLC, the world's largest producer of spirits and beer, according to data compiled by Bloomberg.That's likely to be a safe bet as no one is counting on the British economy rebounding significantly from near the bottom of the EU while the uncertainty created by Brexit persists. “If you take a long view, then this may well be a great time to be investing in U.K. equity,” said Rogoff. “Thankfully, I don't have to make that binary call because there are very few U.K. companies I'm frankly interested in.”(Corrects location of Tencent Holdings headquarters in fifth paragraph of article published July 16.)\--With assistance from Shin Pei, Richard Dunsford-White, Kateryna Hrynchak and Suzy Waite.To contact the author of this story: Matthew A. Winkler at mwinkler@bloomberg.netTo contact the editor responsible for this story: Jonathan Landman at jlandman4@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Matthew A. Winkler is a Bloomberg Opinion columnist. He is the editor-in-chief emeritus of Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Logitech (LOGI) Q1 Earnings & Revenues Top Estimates, Up Y/Y
    Zacks5 hours ago

    Logitech (LOGI) Q1 Earnings & Revenues Top Estimates, Up Y/Y

    Logitech (LOGI) fiscal first-quarter results benefit from solid performance of Video Collaboration unit. Moreover, significant growth in Mobile Speakers business is a tailwind.

  • Bloomberg7 hours ago

    Alibaba Is Opening Up to U.S. Merchants for the First Time

    (Bloomberg) -- Alibaba Group Holding Ltd. is opening its oldest online platform to U.S. merchants, promising to help American businesses at a time U.S.-Chinese tensions are darkening the outlook for global trade.The Chinese e-commerce giant on Tuesday opened up Alibaba.com to U.S. sellers for the first time, allowing them to peddle to buyers around the world who seek merchandise to stock shelves or materials to make products. Alibaba says it now wants American producers to hawk their wares as well, eventually helping them tap a vast Chinese market. Fruit and vegetable wholesaler Robinson Fresh and Office Depot Inc. will be among the first U.S. names to join Alibaba.com.Two years after billionaire founder Jack Ma promised Donald Trump he would help create a million American jobs, Alibaba is opening up its wholesale platform to U.S. sellers who want to tap a multi-trillion dollar global procurement market. The initiative could generate new income and also goodwill for Alibaba in the U.S., particularly as Washington and Beijing spar over trade. The threat of rising tariffs is now encouraging businesses to source their merchandise and components locally, said John Caplan, president of Alibaba’s North American business-to-business effort.U.S. business owners “increasingly want to find domestic producers because of trade concerns and this platform will allow them to do that,” he told Bloomberg News. He anticipates strong demand for American agricultural produce and consumer products. “Anything you put on or in your body.”Alibaba will send staff to promote the service to businesses and local chambers of commerce, and plans a September promotional event to drum up awareness, Caplan added.The Chinese internet powerhouse is opening up Alibaba.com just as a decelerating home economy depresses the top line. The online retailer is expected to soon post its slowest quarterly revenue growth in three years.Unlike its better-known consumer bazaars Taobao and Tmall, Alibaba.com was originally envisioned as a way to match foreign firms with Chinese wholesalers of everything from watches and shoes to raw textiles. Operating under the motto “global trade starts here,” Alibaba.com now connects about 150,000 mostly Chinese sellers. It had some 650,000 registered U.S.-based companies as of 2017. Those American businesses previously could only buy, not sell, via Alibaba.com.It’s the Chinese giant’s oldest business but now accounts for just a sliver of revenue, mostly through membership fees, marketing and shipping assistance.Alibaba still gets the vast majority of its revenue at home, but has taken steps to court international markets in recent years. It acquired Lazada to spearhead a foray into Southeast Asia. It’s also tweaking its main businesses: in June, it set up an English-language portal on Tmall for the first time to entice more merchants from around the world to sell to Chinese consumers.But like rival JD.com Inc., Alibaba is trying to grab a bigger slice of so-called cross-border e-commerce, particularly as affluent consumers in the world’s No. 2 economy buy more goods from abroad. That market is expected to reach 3.6 trillion yuan ($523 billion) by 2020, according to AliResearch, a unit of Alibaba.To contact the reporters on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net;Olivia Rockeman in New York at orockeman1@bloomberg.netTo contact the editor responsible for this story: Edwin Chan at echan273@bloomberg.netFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Business Wire7 hours ago

    Alibaba.com Opens Platform to Empower U.S. Small Businesses to Sell to the World

    Alibaba.com, one of the world’s largest B2B ecommerce marketplaces and a business unit of Alibaba Group (BABA), today opened its platform to empower U.S. businesses to sell their products to millions of Alibaba.com buyers in the U.S. and around the globe. The first in-person Alibaba.com Build Up event will be held today in Brooklyn at Industry City – a community of innovative industrial and manufacturing businesses – along with co-hosts, the Brooklyn Chamber of Commerce and Industry City.

  • Alibaba is expanding its commercial platform to U.S. small businesses
    MarketWatch7 hours ago

    Alibaba is expanding its commercial platform to U.S. small businesses

    Alibaba Group Holding Ltd. is taking a global approach to a business unit where it sees significant untapped potential.

  • Wall Street Invaders Won’t Clear This Moat
    Bloomberg19 hours ago

    Wall Street Invaders Won’t Clear This Moat

    (Bloomberg Opinion) -- Supply-chain finance is the secret sauce behind Citigroup Inc.’s mid-20% return on equity from transaction banking.That might sound counterintuitive, especially in Asia. The export-led region is facing the brunt of supply dislocations as the U.S.-China trade war intensifies. But the skirmish isn’t a showstopper for financing. As production moves from one country to another, transactions that need to be greased with money or credit will occur somewhere else. They won’t disappear.For evidence, take a peek at Citi’s recent quarterly results. The bank has $715 billion in deposits from institutional clients. About $166 billion of it is in Asia, up 8% from a year earlier and growing faster than consumer banking deposits. What’s more, Citi doesn’t even have to aggressively seek corporate liquidity by promising high interest rates. It just has to work with a few hundred clients – not just Western multinationals like Procter & Gamble Co., but also Asian ones such as Alibaba Group Holding Ltd. and Xiaomi Corp. – by lubricating their vast global supply chains running into tens of thousands of vendors.Imagine a detergent maker in Indonesia that gets paid by P&G 90 days after billing. The company would be tempted to accept money from Citigroup even for 120 days if doing so helps to keep its domestic bank-financing lines unencumbered. Citi doesn’t take any credit risk on this small supplier because the bank is going to be paid by P&G, which also benefits by getting an extra 30 days to settle its bills. A big chunk of the corporate cash swirling on Citi’s balance sheet is what the multinationals have in their accounts at the bank , vast sums that ensure supply chains function smoothly.In a two-part series about virtual banking – the hottest new thing in Asian finance this year – my colleague Nisha Gopalan and I concluded that corporate cash management may be a more lucrative bastion than retail for the digital warriors to storm. That’s particularly so for Wall Street banks looking beyond fickle investment-banking revenue. However, even that “more modest leap of faith,” as we described the lure of transaction banking to the likes of Goldman Sachs Group Inc., will have trouble clearing Citi’s moat. It may not be impossible for an online-only bank to operate in more than 160 countries, deal with heavy penalties in case it flouts sanctions or gets dragged into a money-laundering scandal, and over time build its own war chest of deposits. But it’s certainly going to be difficult.None of this means that traditional transaction bankers can rest easy. In the world they’re familiar with, materials move one way; money in the opposite direction. The greater the risk of interruption to the flows, the higher the premium for ensuring they don’t. This age-old landscape is changing fast. The consumption of a Netflix movie or a Spotify song is purely digital. Deloitte estimates that by 2025, more than a third of all consumption in Australia, Hong Kong, Singapore and Malaysia will be done by people born after 1980. The spending of digital native generations – Y and Z – will be light on materials.Transaction bankers can’t dig themselves into a hole and pretend they’re engaged in a pure business-to-business activity. If you want to bank Uber Technologies Inc., you have to grapple with the financing of the discount coupons on late Uber Eats deliveries.Many things in the new digital supply chain will be done more efficiently by non-banks. Deloitte cites the example of Traxpay, chosen this year by Edeka Group, a large German food retailer, to handle the working capital needs of its vendors. Platforms like Traxpay will still need banks. But the real profit lies in owning the client relationships, not in providing money. To retain their edge banks will either have to buy promising fintech firms, or build their own rival products. Both options are capital-intensive; neither is guaranteed to succeed.We’ve previously characterized transaction banking as humdrum to distinguish it from its flashier cousin of retail digital banking. But not only is supply-chain finance juicy for banks, its meat-and-potatoes wholesomeness is drawing in fintech and Wall Street investment banks. The $715 billion of cheap liquidity sitting on the balance sheet of the big daddy of transaction banking is both a temptation for challengers, and a dare. It’ll be interesting to see where those deposits are five years from now.\--With assistance from Nisha Gopalan To contact the author of this story: Andy Mukherjee at amukherjee@bloomberg.netTo contact the editor responsible for this story: Matthew Brooker at mbrooker1@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Alibaba (BABA) Outpaces Stock Market Gains: What You Should Know
    Zacks20 hours ago

    Alibaba (BABA) Outpaces Stock Market Gains: What You Should Know

    In the latest trading session, Alibaba (BABA) closed at $174, marking a +0.58% move from the previous day.

  • 2 Chinese Stocks Seeing Unusually Heavy Options Trading
    Schaeffer's Investment Researchyesterday

    2 Chinese Stocks Seeing Unusually Heavy Options Trading

    Calls have been popular on both names

  • Top Ranked Momentum Stocks to Buy for July 22nd
    Zacksyesterday

    Top Ranked Momentum Stocks to Buy for July 22nd

    Top Ranked Momentum Stocks to Buy for July 22nd

  • Trading Frenzy Grips China’s New Stock Venue After Big IPO Gains
    Bloombergyesterday

    Trading Frenzy Grips China’s New Stock Venue After Big IPO Gains

    (Bloomberg) -- They propelled a little-known semiconductor manufacturer to a 521% surge, traded a mid-sized railway company 13 times more feverishly than the world’s largest bank and valued a chipmaking-gear producer at an eye-watering 730 times earnings.Chinese investors greeted the opening of the country’s Nasdaq-style equity market with a frenzied burst of trading on Monday, driving gains in all 25 companies that made their debut. The stocks jumped an average 140% at the close in Shanghai, even as most slipped from their intraday highs. About 48.5 billion yuan ($7.1 billion) of shares changed hands on the so-called Star board, or about 13% of turnover in the rest of the market.The new venue is China’s latest attempt to avoid losing the next Alibaba Group Holding Ltd. or Tencent Holdings Ltd. to exchanges in New York or Hong Kong. Endorsement from top officials helped generate such enthusiasm that firms raised a combined $5.4 billion, about 20% more than planned. Demand from retail investors has outstripped supply by an average 1,800 times, even as some analysts voiced concern over lofty valuations.“Gains were much stronger than expected, either due to unreasonable IPO pricing or speculative trading,” said Zhu Junchun, a Shanghai-based analyst with Lianxun Securities Co. “It’s going to be a liquidity game in the first half year or one year of trading. Judging by the trading activity and gains on the board, it’s definitely a success.”The board is also a testing ground for regulators, who have waived rules on valuations and debut-day price limits for the first time since 2014. The venue is the only one in China to welcome companies that have yet to make a profit, as well as shares with unequal voting rights. The Shanghai stock exchange will create an index tracking the firms about two weeks after the 30th listing starts trading.Shares on the Star board have no daily price limits for the first five trading days, followed by a 20% cap in either direction. To limit volatility, the venue suspends activity for 10 minutes if a stock moves by 30% and then 60% from the opening price in the first five trading days, a wider band than the rest of the stock market. Only certain qualified foreign investors can buy the stocks directly, as there’s no access through trading links with Hong Kong.The first batch of listings included China Railway Signal & Communication Corporation Ltd., whose Hong Kong shares sank on huge volume as traders switched into the A shares. Advanced Micro-Fabrication Equipment Inc., which was the most expensive listing of the batch, jumped as much as 331%. Its 171 multiple compared with an average of 53 times for the group, and 33 for similar stocks on other Chinese venues.Despite the hype, there are questions about whether the excitement will give way to the lukewarm sentiment that’s blanketing the world’s second-largest equity market. On the other hand, a sustained period of ultra-high demand risks draining funds from other exchanges, where volumes are shrinking. The Shanghai Composite Index fell 1.3% on Monday, while the ChiNext Index was down 1.7%.It’s not the first time China has sought to create an alternative venue for smaller companies. The ChiNext board was launched in Shenzhen almost a decade ago with fewer listing requirements than the main venues. The tech-heavy exchange was at the center of a spectacular boom and bust in 2015 that burned hordes of novice traders. Officials will be keen to avoid such extreme volatility -- the ChiNext remains more than 60% below its peak four years ago.“I’m not going to participate in the Star board anytime soon,” said Qu Shaohua, managing director at Acroguardian Investment Co. “With prices at these levels it will take quite a long time for the market to fully digest the current valuation and adjust to a reasonable price.”The Star board’s launch dovetails with Beijing’s pledge to boost direct financing for companies struggling to raise funds, and has taken on added significance as heightened trade tensions with the U.S. threaten China’s technology supply chain.“I would say that the launch is a success,” said Fu Lichun, an analyst at Northeast Securities. “People are indeed quite enthusiastic, and maybe got a little over-excited at the open.”\--With assistance from Irene Huang, Lujia Yu, Fox Hu, Ken Wang, Ludi Wang and Michael Patterson.To contact Bloomberg News staff for this story: Evelyn Yu in Shanghai at yyu263@bloomberg.net;April Ma in Beijing at ama112@bloomberg.net;Amanda Wang in Shanghai at twang234@bloomberg.netTo contact the editors responsible for this story: Sofia Horta e Costa at shortaecosta@bloomberg.net;Sam Mamudi at smamudi@bloomberg.netFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Bloombergyesterday

    Bangkok Startup Raises Funding to Help L'Oreal Sell Online

    (Bloomberg) -- aCommerce, a Bangkok-based startup that helps brands such as Samsung, L’Oreal and Unilever sell their products online across Southeast Asia, has raised more than $10 million from existing investors including KKR & Co.KKR’s Emerald Media, investment house Blue Sky, DKSH Holding AG and an arm of Indonesian conglomerate Sinar Mas also took part in the company’s latest funding round, intended to drive the startup’s expansion and help it reach profitability by early 2020. That in turn paves the way for an initial public offering in two to three years, Chief Executive Officer Paul Srivorakul said. The six-year-old firm plans to raise another $5 million by the end of this year as part of an extended Series B or early-stage funding round, he added.“We have the ambitions for an IPO so it’s really important that we grow a healthy, valuable business,” Srivorakul said in an interview.aCommerce is trying to set itself apart from other online retail startups that focus on growth over the bottom line. Rather than go head-to-head against Chinese giants from Alibaba Group Holding Ltd. to Tencent Holdings Ltd. and JD.com Inc., which have made inroads into the region in recent years, the Thai outfit concentrates on supporting brands keen on expanding their own online sales.aCommerce makes money by providing services from distribution and marketing to warehousing and delivery. It operates in Singapore, Indonesia, Thailand, Malaysia and the Philippines. In 2018, revenue grew 73% to more than $100 million, and its core market of Thailand turned profitable, according to the CEO.It’s early days but the company may choose to list in Bangkok, Singapore or Australia to stay close to the Southeast Asian market, he said.To contact the reporter on this story: Yoolim Lee in Singapore at yoolim@bloomberg.netTo contact the editors responsible for this story: Edwin Chan at echan273@bloomberg.net, Lulu Yilun ChenFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Wanna Bet $1.3 Trillion on Chinese Regulators?
    Bloomberg2 days ago

    Wanna Bet $1.3 Trillion on Chinese Regulators?

    (Bloomberg Opinion) -- If you hold shares in New York-listed Alibaba Group Holding Ltd., you don’t own a stake in a Chinese internet powerhouse.What you have are the American depositary receipts of a Cayman Islands company that has a contract with the Chinese firm. In fact, the country’s largest search and e-commerce provider(1)is ultimately controlled by Alibaba Partnership, a collection of 38 people, most of whom hold senior positions in the company.This business structure, called a variable-interest entity, became common among Chinese companies because Beijing restricts foreign investment in certain sectors, such as the internet. It also enables firms to raise money abroad and lets early investors get their funds out of the country. Tencent Holdings Ltd., Meituan Dianping and Baidu Inc. all hew to various versions of the VIE, allowing them to exploit a gap in Chinese law.In total, almost $1.3 trillion in market capitalization is linked to Chinese VIEs listed outside the mainland, according to U.S. credit-ratings provider Standard & Poor’s Financial Services LLC.For now, these companies aren’t doing anything illegal and Beijing hasn’t seen the need to close this loophole. Keeping VIEs operating in a gray area gives policymakers the flexibility to crack down at will. But as the trade war intensifies, China has a growing incentive to keep its tech giants, and their cash, at home. In that light, it’s not inconceivable that officials would take steps to eliminate the structure, even if it spooks foreign investors.For years, knowledge that the Chinese government could take action at any time hung a legal cloud over VIEs. S&P previously accounted for such risk among VIEs operating in sensitive businesses, such as Alibaba and Tencent, though not for others in more mundane areas like retail.In a report last week, analysts Clifford Kurz and Sophie Lin wrote that recent changes in China’s foreign-investment law make no mention of VIEs, after an earlier draft sought to prohibit them. S&P interprets this to mean that concerns have diminished. I understand their reasoning, but disagree with the conclusion.Silence is certainly better than an explicit ban. Yet having a gray area within an opaque legal system simply puts such companies and investors at the whim of policymakers. There may indeed be a lack of incentive to dismantle VIEs today, and doing so probably would hurt foreign-investor sentiment. Neither factor amounts to much if Beijing one day gets fed up with Chinese companies using overseas listings as a way to get their assets offshore.This year alone, 31 Chinese companies chose to raise almost $6 billion by listing in the U.S. Not because they get better valuations there, but because founders and VCs know a public offering in China would give them illiquid assets subject to capital controls. Beijing has tried all sorts of things to encourage its companies to list at home, the latest being the SSE STAR Market – a Nasdaq-style tech board – for which regulators eased rules to attract interest. Yet as my colleague Nisha Gopalan wrote recently, Chinese companies still want to raise dollars, both to fund expansion and give Western venture-capital firms a hard-currency exit.If such carrots keep failing, Beijing could very well bring out sticks. Given the state of U.S.-China relations, there’s little reason to believe policymakers will prioritize the concerns of foreign investors over its own desire to prevent capital flight.This means that in assessing VIEs, foreign investors need to consider whether they’re willing to leave $1.3 trillion to the whims of a Chinese legal gray area.(1) Alibaba's revenue primarily comes from sellers paying to get elevated in search results on its platforms.To contact the author of this story: Tim Culpan at tculpan1@bloomberg.netTo contact the editor responsible for this story: Rachel Rosenthal at rrosenthal21@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Tim Culpan is a Bloomberg Opinion columnist covering technology. He previously covered technology for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Financial Times2 days ago

    Why the wheels fell off China’s tech boom 

    From Xiamen to Shanghai mass graveyards of dirty bikes, all twisted frames and busted axles and handlebars, have become an unwanted emblem for hundreds of Chinese start-ups that once thrived on the back of easy money, hard graft and a light regulatory touch. When the idea took hold in 2015, the bike rental companies’ promise to attract China’s booming middle class pulled in billions of dollars from investors even if they often charged cyclists very little or in some cases nothing to use their services.

  • Alibaba to empower U.S. small businesses to sell globally
    Yahoo Finance Video2 hours ago

    Alibaba to empower U.S. small businesses to sell globally

    Alibaba is opening its platform to let U.S. businesses sell to its millions of global buyers. Alibaba sees this as a $1 trillion market for domestic B2B e-commerce in the US alone. Yahoo Finance's YFi AM breaks down the details with John Caplan, Head of Alibaba.com North America.