{"id":746,"date":"2022-03-21T16:20:00","date_gmt":"2022-03-21T16:20:00","guid":{"rendered":"https:\/\/www.hyperscalevntures.com\/?p=746"},"modified":"2022-03-24T16:26:15","modified_gmt":"2022-03-24T16:26:15","slug":"alibaba-hikes-buybacks-to-25-billion-as-crackdown-signals-ease","status":"publish","type":"post","link":"https:\/\/www.hyperscalevntures.com\/?p=746","title":{"rendered":"Alibaba hikes buybacks to $25 billion as crackdown signals ease"},"content":{"rendered":"\n

The board of China\u2019s e-commerce leader has approved the program, which will run for two years through to March 2024, the company said in a statement.<\/em><\/p>\n\n\n\n

Alibaba Group Holding Ltd. ramped up its share buyback program to $25 billion, expanding that arsenal for a second time in less than a year to stanch a $470 billion loss of value during Beijing\u2019s internet crackdown.<\/p>\n\n\n\n

The board of China\u2019s e-commerce leader has approved the program, which will run for two years through to March 2024, the company said in a statement. It also appointed a new independent director in Shan Weijian, chairman of alternative asset management house PAG. Shan, a longtime investor in Chinese companies, will replace Ericsson Chief Executive Officer B\u00f6rje Ekholm from March 31.<\/p>\n\n\n\n

Alibaba\u2019s up-sized buyback represents one of the largest shareholder-reward programs in China\u2019s giant internet industry, and coincides with a re-calibration of sentiment after Xi Jinping and his deputy Liu He pledged to support the economy and markets and finish the clampdown on the tech sector \u201cas soon as possible\u201d — triggering a historic rally in Chinese stocks.
Alibaba\u2019s shares gained as much as 5.4% in Hong Kong on Tuesday. China\u2019s largest companies are only just starting to emerge from a year of unparalleled regulatory scrutiny into sectors from online commerce to social media.<\/p>\n\n\n\n

The buyback \u201csignals where company management sees value, and it may also be a bellwether for where they see regulatory action — perhaps we are coming closer to the end of it,\u201d said Justin Tang, head of Asian Research at United First Partners in Singapore.<\/p>\n\n\n\n

Chinese tech corporations have until recently rarely resorted to big shareholder-return programs like dividends or stock repurchases. But the country\u2019s largest corporations have resigned themselves to a new era of cautious expansion, nearly two years into a bruising internet crackdown that quickly engulfed everything from e-commerce to ride-hailing and online education.<\/p>\n\n\n\n

Alibaba reported its slowest growth on record during the December quarter, and Tencent Holdings Ltd. is expected to do the same on Wednesday. E-commerce rival Pinduoduo Inc. reported revenue that missed estimates for the third straight quarter.<\/p>\n\n\n\n

Alibaba acquired 56.2 million American depositary shares under its previously announced share buyback program for about $9.2 billion, Alibaba said in its statement on Tuesday.<\/p>\n\n\n\n

Chief Executive Officer Daniel Zhang has sketched out how China\u2019s e-commerce leader will now prioritize user retention over acquisition — a significant shift for a company that achieved massive scale by vanquishing rivals like EBay Inc. and fought rivals in arenas from media to the cloud and commerce.<\/p>\n\n\n\n

The about-face underscores a growing realization of the speed with which up-and-coming competitors from ByteDance Ltd. to PDD are drawing users from traditional leaders Alibaba and JD.com Inc., even as the Chinese economy struggles to recover during punishing Covid-Zero lockdowns.<\/p>\n\n\n\n

\u201cThe Chinese generally believe you shouldn\u2019t waste the bullet when the tide is against you,\u201d Kamet Capital Partners Chief Investment Officer Kerry Goh said. \u201cCould this be a signal that the management believes the worst is behind them especially since Liu He\u2019s announcement last week?\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

The board of China\u2019s e-commerce leader has approved the program, which will run for two years through to March 2024, […]<\/p>\n","protected":false},"author":1,"featured_media":747,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[76],"tags":[],"class_list":["post-746","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"amp_validity":null,"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=\/wp\/v2\/posts\/746","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=746"}],"version-history":[{"count":1,"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=\/wp\/v2\/posts\/746\/revisions"}],"predecessor-version":[{"id":748,"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=\/wp\/v2\/posts\/746\/revisions\/748"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=\/wp\/v2\/media\/747"}],"wp:attachment":[{"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=746"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=746"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.hyperscalevntures.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=746"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}