Alibaba Holding's honeymoon with foreign investors is over since the Chinese e-commerce giant broke records for an initial public offering at the New York Stock Exchange in September 2014 by raising $25 billion fresh capital. Since then, price of Alibaba stock has tumbled down to a record-low of 35 percent from its November 2014 IPO price, 14 percent above the IPO price of $68.
Among the biggest losers is Alibaba founder Jack Ma whose fortune decreased by $752 million on Wednesday when shareprice of the company slid 5.1 percent that day and closed at $73.38 in New York. As a result, Ma's net worth dropped 2.4 percent to $31.2 billion from $37.4 billion on June 3, reports Bloomberg.
Reckoned from January, Alibaba lost over $71 billion of its market value amid weak sales and transaction volumes missing analysts' estimate, a slowdown in the Chinese economy and counterfeit lawsuits. For Q2, Alibaba reported its revenue increased to $3.27 billion, while net income was $1.5 billion which was in line with analysts' expectations. Analysts say that Alibaba's core business is still strong.
While Ma was not alarmed over the losses, saying he is focused on long-term rather than short-term stock movements, the former school teacher said he would authorize a $4 billion buyback program over two years to help offset the shares' dilution from employee compensation tied to stock, reports The New York Times.
Despite the losses, Ma and Alibaba Executive Vice Chairman Joseph Tsai said they are not selling shares, except for small amounts in their charitable trusts. The 50-year-old Ma, who holds a 6.2 percent stake in Alibaba, is still the 21st richest person in the world, says the Bloomberg Billionaires Index. He is also the third-richest person in Asia, after Wang Jianlin and Li Ka-shing.