Alibaba logo on the facade of its offices in Beijing in January.THOMAS PETER / Reuters
Alibaba does not expect any material impact from the antitrust measures imposed by China, which will push it to review the way it deals with merchants, its chief executive said Monday after the Chinese regulator fined the e-commerce giant 2,750. million dollars (2.3 billion euros) for abusing their dominance in the market.
Alibaba Group shares rose up to 9% on the Hong Kong Stock Exchange after putting an end to the biggest unknown facing the company, and when it became clear that the fine and the measures ordered by the regulator will not have a profound impact on the firm.
Alibaba has come under intense scrutiny since its billionaire founder Jack Ma publicly criticized the Chinese regulatory system in October.
As part of the "comprehensive rectifications" requested by regulators, Alibaba will make it easier for stores to sell through its platform, Chief Executive Daniel Zhang said at an online conference for media and analysts.
Beijing wants Alibaba to stop requiring retailers to choose between doing business with it or with rival platforms, a practice known as "trade exclusivity," which critics say helped it become China's largest e-commerce company. .
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Alibaba executives said that despite Saturday's record 18 billion yuan ($ 2.75 billion) fine and measures ordered by regulators, they remain confident in the government's general support for the company.
"They are reaffirming our business model," said Alibaba Executive Vice President Joe Tsai, adding: "We feel comfortable because there is nothing wrong with our model."
Uncertainty is reduced
Shares of the company rose about 8% in afternoon trading in Hong Kong (during the early hours of Monday on the Peninsula), adding 48.5 billion dollars to its market value, coming very close to registering its biggest gain. in a single day in almost three months.
"Now that the sanction is determined, the market uncertainty about Alibaba will be reduced," said Everbright Sun Hung Kai analyst Kenny Ng.
“The price of Alibaba shares has lagged behind the shares of companies in emerging countries.
This sanction is expected to allow the Alibaba listing to regain market attention, ”he added.
In addition to imposing the fine, which is among the highest antitrust sanctions in history globally, the Chinese market regulator ordered Alibaba to carry out "comprehensive rectifications" to strengthen internal compliance and protect consumer rights.
"The required corrective actions will likely limit Alibaba's revenue growth as further expansion of market share will be restrained," said Lina Choi, an executive at Moody's Investors Service.
"Investments to retain merchants and improve products and services will also reduce profit margins," he said.