Questions about Alibaba's future dampen first anniversary of record-breaking IPO

Chinese e-commerce powerhouse Alibaba Group yesterday marked the first anniversary of its US$25 billion initial public offering, the world's largest, with a number of questions looming over its future.

A year ago, New York-traded Alibaba was the toast of the town as its US listing gave a huge windfall to co-founder Jack Ma Yun and the company's senior management, major shareholders like Japan's SoftBank and online giant Yahoo, and global investors that had bet on the continued fast-paced development of China's internet industry.

But a year later the party is over for Alibaba. Investors have expressed concerns about the company's direction amid lowered sales estimates due to weakening demand at home, the slowest revenue growth in three years, and a stock value that has fallen below its listing price of US$68.

A telltale sign of Alibaba's plight was its recent decision to embark on a massive US$4 billion share buy-back programme over a two-year period to ease investors' concerns.

Ma, Alibaba's executive chairman, has said that he was used to "unlucky things happening every day", but this did not prepare him for this month's broadside from US news outlet Barron's, which suggested up to a 50 per cent decline in Alibaba's share price from its current level.

The story was also critical of Alibaba's investments beyond online retail - including in media, entertainment, logistics and cloud computing - which "seem aimed more at beguiling investors than improving earnings".