Alibaba Group Holding Limited (BABA) saw its U.S.-listed shares surge on Tuesday following a significant announcement concerning its Hong Kong-listed shares. The e-commerce giant’s Hong Kong shares have been added to China’s Shanghai-Hong Kong and Shenzhen-Hong Kong Stock Connect programs, dramatically expanding the company’s potential investor pool by allowing 200 million mainland investors to trade in its stock.
This inclusion of Alibaba in the Stock Connect program holds the potential to unlock billions of dollars in capital inflows. According to Morgan Stanley, the move could generate up to $12 billion in new investments over the next six months. This marks a major step forward for Alibaba as it continues to recover from challenges posed by domestic regulatory scrutiny and economic slowdowns in China.
Alibaba’s recent dual-primary listing in Hong Kong paved the way for this Stock Connect inclusion. Now, with access to a much larger pool of mainland investors, the company is better positioned to attract substantial capital inflows, which could help bolster its stock performance after months of underperformance.
In other news, Joe Tsai, Alibaba’s chair and co-founder, is branching out beyond the tech sector with his investments. Through his family office, Blue Pool Capital, Tsai has acquired parcels of elite vineyards in Burgundy, one of France’s most prestigious wine regions. Partnering with Oliver Weisberg, Blue Pool Capital’s CEO, Tsai’s foray into the French wine industry further diversifies his already broad portfolio.
Many of the wines from this region are renowned for their exclusivity, with some bottles fetching hundreds of dollars. Tsai’s $6.9 billion fortune, according to the Bloomberg Billionaires Index, is largely derived from his 1.4% stake in Alibaba, but his new ventures showcase a clear intent to diversify into other sectors, including luxury products like wine.
Alibaba shares were up by 1.98% at $83.05, according to Benzinga Pro.
