Alibaba is a China-based e-commerce company that operates as a platform which enables third parties to buy and sell their products. The company operates Taobao Marketplace, China’s largest online shopping destination; Tmall, China’s largest third-party platform for brands and retailers; and Juhuasuan, China’s most popular group buying marketplace.
Currently, Chinese online shopping penetration is 48.9% of the total internet users, significantly lower than 74.2% in the US and 77.6% in the UK. It is expected (according to a McKinsey study) that the Chinese online retailing market would grow at 15-20% annually until 2020, reaching USD 420-650 bn. BABA is undoubtedly a leader in its market and stands to gain most. Alibaba offers one of the best revenue and earnings growth rates in the industry globally and therefore investors should benefit equally from the company’s performance.