Internet sales in the world’s second-largest economy are surging as online sellers led by Alibaba are luring more of the nation’s 618 million users. E-commerce sales jumped 52 percent in the first four months of 2014 from a year earlier, while broader retail sales gained 12 percent, which represented the weakest start to a year since 2004, according to the nation’s statistics bureau.
Favorite China IPOs in the U.S. are those “linked to the consumer discretionary and technology/e-commerce sectors,” Josef Schuster, the founder of IPOX Schuster LLC in Chicago, an IPO research firm, said by e-mail on June 6.
JD.com, China’s second-largest e-commerce site, surged 40 percent since its IPO, while Jumei International Holding Ltd., a Beijing-based online seller of beauty products, jumped 35 percent after raising $245.1 million on May 16.
With an estimated market value of $168 billion, Hangzhou, China-based Alibaba could raise as much as $20 billion, topping a $19.65 billion offering by Visa Inc. in 2008, data compiled by Bloomberg show.
For Chinese IPOs in the U.S., “it will be more difficult to sustain the outperformance,” according to IPOX’s Schuster. Chinese deals will get higher initial valuations, narrowing the discount to their counterparts, he said.