Alibaba Aims to Raise $1 Billion in U.S. Initial Public Offering (IPO)

Alibaba Group Holding Limited, the largest e-commerce company in China officially submitted its form F-1 registration statement with the Securities and Exchange Commission (SEC) for an initial public offering (IPO) in the United States on Tuesday.

Based on its filing, the Chinese e-commerce giant aims to raise $1 billion from the IPO, but analysts suggest that it could raise as much as $20 billion. Based on the projection of analysts, Alibaba Group’s IPO could top Facebook Inc (NASDAQ:FB), which raised $16 billion from its IPO in 2012.  Analysts believed that Alibaba’s U.S. IPO will be the largest in the history of the technology industry.

Gene Munster, a managing director and senior research analyst at Piper Jaffray opined, “It’s the biggest e-commerce growth story in the world. That’s why investors are so excited to get involved.”

Alibaba Group has not yet revealed its ticker symbol, and which stock exchange it plans to trade its American Depository Shares. The Chinese e-commerce giant has not yet determined the offering price for its shares.

Jack Ma, a teacher in English founded Alibaba Group in 1999.  The company operates three retail marketplaces in China including Taobao, the largest online shopping destination in the country; Tmall, the largest third-party platform for brands and retailers; and Juahuasuan, the most popular group buying market place in the country. The company said its total mobile GMV was $37 billion last year.

Alibaba Group’s market places have 231 million active buyers and 8 million active sellers as of December 31, 2013.  The company generated $242 billion combined gross market volume (GMV) from its market places, which account 82.7% of its total revenue in the nine months ended December 31 last year.

Alibaba Group also operates, the largest global online market place last year in terms of revenue and AliExpress, its global consumer marketplace. The company also operated Alipay, a payment and escrow services for buyers and sellers with a total payment volume of $519 billion last year.

In terms of financial performance, Alibaba Group revealed that its total revenue was $6.5 billion and net income was $2.9 billion for the nine months ended December 31, 2013.