NEW YORK: Alibaba Group Holding's shares surged by more than 40% on their first day of trading on Friday as investors jumped in to buy what looks likely to be the largest IPO in history.

More than two hours after trading began at the New York Stock Exchange, the stock opened at $92.70 and rose from there, hitting a high of $99.70 in active trading, during which more than 100 million shares change hands in composite trading in the first 10 minutes of trading.

Its spectacular debut ensured that Alibaba comfortably surpassed Facebook by market capitalisation on its first trade as a public company for a valuation of more than $200 billion. The Chinese ecommerce company now trails only Google, Apple and Microsoft Corp in size among UStraded technology companies. "This is by far the biggest IPO event-extravaganza that we've had," said a trader.

The pricing on Thursday initially raised $21.8 billion for Alibaba. Scott Cutler, head of the New York Stock Exchange's global listing business, said underwriters would exercise their option for an additional 48 million shares, to bring the IPO's size to about $25 billion, making it the largest IPO in history.

The sale values the company at about $168 billion, more than American icons such as Walt Disney and Coca-Cola. Should the stock close at $98 on its first day, it would be worth about $241 billion, nearly the value of Walmart Stores.

Jack Ma, a former English teacher, founded Alibaba in 1999 in his apartment. His personal fortune is more than $14 billion on paper, vaulting him into the ranks of such tech billionaires as Bill Gates and Jeff Bezos. The deal is also expected to make millionaires out of a substantial chunk of the company's managers, software engineers and other staff. The rise in the stock exceeds the average gain by new IPOs on US exchanges of late. In the second quarter, the average first-day gain was 9.2%, according to Renaissance Capital IPO Intelligence.

Underwriters usually aim for a gain of 10-15% on the first day. Demand was intense among the retail investor crowd as well. JJ Kinahan, chief market strategist at retail brokerage TD Ameritrade Holding Corp, said the company received customer orders amounting to about 70% of what it saw for Facebook, and about three times the customer orders it had for Twitter's IPO.
With underwriters electing to sell more shares, the company's IPO becomes the largest in history, surpassing Agricultural Bank of China Ltd's $22.1 billion listing in 2010.



Source>> http://economictimes.indiatimes.com/markets/stocks/news/alibaba-debuts-with-a-bang-on-wall-street-stock-lists-at-92-70/share/articleshow/42922661.cms