Jack Ma and Cai Chongxin Buy Alibaba Shares... Stock Savior Role

Purchase of Hong Kong stocks worth 67 billion won each
Stock price surges nearly 8% in one day

Former and current chairmen of Alibaba, China's largest e-commerce company, have stepped in as 'saviors' of the plunging stock price by purchasing company shares one after another.

On the 23rd, China's Pengpai News cited documents filed by Alibaba with securities authorities, reporting that Ma Yun, the honorary chairman and co-founder of the company, and Cai Chongxin, the chairman, purchased Alibaba Hong Kong shares worth $50 million (about 67 billion KRW) and Alibaba depositary receipts worth $151 million, respectively, in the fourth quarter of last year.

[Image source=Yonhap News]

Alibaba's market capitalization stands at around $171 billion, so the scale of their purchases is not large, but investors interpreted the news of the former and current chairmen stepping in as a positive factor. In particular, Ma Yun had announced in November last year that he would sell 10 million shares of Alibaba worth about 1.155 trillion KRW, and prior to that, he had continuously sold shares, reducing his stake to below 5%. When the news broke that Ma Yun suddenly bought shares, Alibaba's stock price closed up 7.8% on the New York Stock Exchange on the 23rd, soaring as much as 8.6% during the session.

Pengpai News explained, "Analysts see the founders securing shares as reflecting confidence in Alibaba's future development, management, and strategic direction," adding, "It has been confirmed that Ma Yun's sale of Alibaba shares did not actually take place, and rather, his stake has increased."

Previously, Alibaba's stock price showed a sluggish trend. Especially, falling behind the growth pace of competitors such as Tencent Holdings and PDD Holdings, the stock price has plummeted more than 40% over the past year. Ma Yun also praised competitor PDD Holdings through an internal bulletin last year while urging Alibaba to correct its management policies. However, at that time, Ma Yun encouraged employees by saying that with determination and effort, Alibaba could succeed again.

Alibaba's business and performance were significantly weakened after Ma Yun publicly criticized Chinese authorities' policies in October 2020, leading to intensified regulatory crackdowns. Subsequently, Ma Yun relinquished management rights of Alibaba's fintech affiliate Ant Group and disappeared from the public eye.

This content was produced with the assistance of AI translation services.