Author Topic: BABA - Alibaba  (Read 61950 times)

hillfronter83

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Re: 1688:HK - Alibaba
« Reply #10 on: April 22, 2014, 06:35:14 AM »
what's the HK ticker for? i thought it was going to list in new york?

There is no HK ticker. Alibaba decides to list in NY because HK will not accommodate its ownership structure and among other reasons.

Alibaba e-commerce site (part of Alibaba Group) was listed in Hong Kong. It was taken private by Alibaba group in 2012.

Another interesting thing I found was that a similar stake as Dongxing holds (part of Yunfeng fund) transacted early this year that valued Alibaba at $129 billion.


yadayada

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Re: 1688:HK - Alibaba
« Reply #11 on: April 22, 2014, 02:57:26 PM »
is there any % of income from alibaba reflected in softbank's figures? They will do 4-6 billion$ in income this year (alibaba). I dont think a 35x multiple is unreasonable for the ipo here. a 33% stake would imply roughly 57 billion$.

Softbank did 3 billion $ in net income, so you pay about 33 billion for the remaining business. Which seems pretty cheap.

If you value softbank at 15x earnings, then your getting alibaba for between 22-33x earnings. Which seems really cheap for a business like that (or at least 22x earnings is). You have serious growth prospects, really high return on capital and a big moat.

sina holds a 1% stake. Ticker is SINA. They bought 50 million$ in octobre 2011. So i assume that is 1%? so that is worth north of 1 billion. They also hold 100 million $ worth of Youku Tudou shares, apparantly the chinese youtube?

And they did 45 million in net income in 2013, and are growing. revenue grew 25% YoY, but gross profit grew 40%. and there seems to be some leverage there. So you could argue that their core business is worth more then 10x earnings?

Anyone have an opinion on Sina?
« Last Edit: April 22, 2014, 04:15:03 PM by yadayada »

yadayada

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Re: 1688:HK - Alibaba
« Reply #12 on: April 22, 2014, 04:58:20 PM »
Ok so Sina holds 56% of weibo, which did an IPO and is the twitter of China apparantly?  Currently Weibo stands at 4.63 billion, so that is 2.6 billion$ for Sina. They have about a billion $ in net cash.

So that is 2.6 billion + 1 billion + 100 million for the youku thing. And add about 1.2 billion for the alibaba stake? That is 4.8 billion $ in net assets. Or maybe a bit less I dont know.

And since weibo is still losing money, their underlying business earns about 45 million$ in 2013 on top of that, and there seems to be some leverage there. So another 450 million? They have a market cap of 3.72 billion. So if we assume roughly 5 billion that is 34% upside.

But it can change wildly. If you think alibaba will do 5 billion and deserves a 35x multiple that is 1.75b$ for sina + 1bn$ in net cash + 2.6 billion$ in weibo + 100 million in youku stock + 15x multiple for their business which earns 45 million = 675 = 6.1 billion$. which implies 64% upside.

Seems worth digging into.
« Last Edit: April 22, 2014, 05:43:58 PM by yadayada »

PatientCheetah

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Re: 1688:HK - Alibaba
« Reply #13 on: April 22, 2014, 05:14:18 PM »
Ok so Sina holds 56% of weibo, which did an IPO and is the twitter of China apparantly?  Currently Weibo stands at 4.63 billion, so that is 2.6 billion$ for Sina. They have about a billion $ in net cash. This does not add in the 563 million Alibaba bought tho. This happened april 9th. im not sure if the 56% is before or after april 9th? Lets assume its not included.

So that is 2.6 billion + 1 billion + 100 million for the youku thing. And add about 1.2 billion for the alibaba stake? That is 4.8 billion $ in net assets. Or maybe a bit less I dont know.

And since weibo is still losing money, their underlying business earns about 45 million$ in 2013 on top of that, and there seems to be some leverage there. So another 450 million? They have a market cap of 3.72 billion. So if we assume roughly 5 billion that is 34% upside.

But it can change wildly. If you think alibaba will do 5 billion and deserves a 35x multiple that is 1.75b$ for sina + 563m$ in cash that is not included in their latest 6k, + 1bn$ in net cash + 2.6 billion$ in weibo + 100 million in youku stock + 15x multiple for their business which earns 45 million = 675 = 6.7 billion$. which implies 80% upside.

Seems worth digging into.

Didn't realize how much hidden assets Sina has. RENN is another hidden asset play, a $3.4 stock with ~$2.8 in net cash but its business is losing money. Not sure if the option value on the business taking off or getting acquired is worth 60+ cents.
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yadayada

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Re: 1688:HK - Alibaba
« Reply #14 on: April 22, 2014, 05:45:17 PM »
http://techcrunch.com/2014/01/07/weibo-payment/

This is interesting, alibaba clearly is interested in weibo. I think they want to set up a payment system through weibo? And with Sina holding 56% now, that could be interesting, what is insider ownership for Sina like?

hillfronter83

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Re: 1688:HK - Alibaba
« Reply #15 on: April 22, 2014, 06:20:50 PM »
is there any % of income from alibaba reflected in softbank's figures? They will do 4-6 billion$ in income this year (alibaba). I dont think a 35x multiple is unreasonable for the ipo here. a 33% stake would imply roughly 57 billion$.

Softbank did 3 billion $ in net income, so you pay about 33 billion for the remaining business. Which seems pretty cheap.

If you value softbank at 15x earnings, then your getting alibaba for between 22-33x earnings. Which seems really cheap for a business like that (or at least 22x earnings is). You have serious growth prospects, really high return on capital and a big moat.

sina holds a 1% stake. Ticker is SINA. They bought 50 million$ in octobre 2011. So i assume that is 1%? so that is worth north of 1 billion. They also hold 100 million $ worth of Youku Tudou shares, apparantly the chinese youtube?

And they did 45 million in net income in 2013, and are growing. revenue grew 25% YoY, but gross profit grew 40%. and there seems to be some leverage there. So you could argue that their core business is worth more then 10x earnings?

Anyone have an opinion on Sina?

If SINA bought the stake in 2011, it's probably worth closer to $200million than $1billion. See this link: http://www.reuters.com/article/2014/02/12/us-alibaba-valuation-idUSBREA1B0E320140212
Looks like Alibaba sold these stakes in 2011 in $50million blocks.

yadayada

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Re: 1688:HK - Alibaba
« Reply #16 on: April 22, 2014, 06:53:45 PM »
that is weird, it was publicly traded in october 2011? 50 million would have bought you a 0.83% stake at worst back then? Why buy a stake at a 300% premium?

Hmm i guess that is only the alibaba website?
« Last Edit: April 22, 2014, 07:03:31 PM by yadayada »

hillfronter83

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Re: 1688:HK - Alibaba
« Reply #17 on: April 22, 2014, 07:22:54 PM »
that is weird, it was publicly traded in october 2011? 50 million would have bought you a 0.83% stake at worst back then? Why buy a stake at a 300% premium?

Hmm i guess that is only the alibaba website?

Yada,

The public traded company in Hong Kong exchange was Alibaba.com, the e-commerce site, which is only part of Alibaba Group. The Alibaba group is much bigger, including taobao.com, tmall.com, Alipay, etc.

PatientCheetah

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Re: 1688:HK - Alibaba
« Reply #18 on: April 22, 2014, 07:32:36 PM »
So the $50 stake is valued closer to $250 mil? The value assigned to Weibo looks high and is probably justified using a per user value argument. It obviously has strategic value to Alibaba, the cash flow rich white knight. So Weibo's private market value shouldn't be too far off from its current market value, at most 20-30% discount.
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ZenaidaMacroura

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Re: 1688:HK - Alibaba
« Reply #19 on: April 22, 2014, 08:44:59 PM »
Maybe I lack imagination, but I don't see this IPOing under 150b?  At least not for investors without access to the IPO.  Would go allin at 80b and just sit pretty for a decade...