It was a short while ago (last Nov) Alibaba did its high profile IPO in Hongkong. Now it’s back in the news again. Don’t get me wrong, Jack Ma (Ma Yun), the founder and Chairman of Ali, was always in the news. I remember a few years ago (when the company was private) he said Ali pays 1 millions Yuan everyday, that’s not a small number and people thought Mr. Ma was bragging. Oh, well, bragging or not. Alibaba’s IPO was very successful, and it created a few hundred millionares (stock option holders) in its employee bases, from what I read last Oct.

Fast forward to March 2008. It reported a good quarter but stock continued to drop (see Sramana Mitra at Seekingalpha). And there is a rumor about class action lawsuit coming (news in Chinese).

(Alibaba 1688.HK 6 month stock chart, full size pic here).

This reminds me a company does similar business in China: Ninetowns. Its CEO is not as high profile as Jack Ma, but the stock shared a same fate: downward most of the time. Yeah, yours truely managed to pick up this crap on its IPO debut and hold it on for 50% loss, and later traded it again for a small loss.

(Ninetowns NINE stock chart, full size pic here).

Disclaimer: please note the author is not against Alibaba and Ninetowns, the companies or the good people working there. The author does feel the pain of the small investors who bought into the hype of the stock during the IPO.