Shares of Alibaba Group Holdings Ltd. was up more than 5% on Monday on trading in Hong Kong, after the e-commerce giant was fined a record $ 2.8 billion by China’s antitrust regulator.
On Saturday, China’s State Administration of Market Regulations said Alibaba abused its dominant position outperforming competitors and sellers on its platform. In addition to the fine, Alibaba must reform operations and submit a compliance report within the next three years.
“Alibaba sincerely accepts the penalty and will ensure compliance with its determination,” the company said in a statement. “To fulfill its responsibility towards society, Alibaba will operate under the law with utmost diligence, continue to strengthen the compliance system and build on growth through innovation.”
With the dark cloud of investigation now gone, Alibaba shares
up more than 8% in early-hour trading in Hong Kong, before falling to a gain of about 5.5%, setting the stage for the US Custodial Receipt
is likely to increase when trading starts on Monday.
“Despite the record fine, we think this will lift the large spread for BABA and shift the market’s focus back to fundamentals,” Morgan Stanley said in a statement. a note on Sunday.
Everbright analyst Kenny Ng Sun Hung Kai wrote: “Now that the penalty has been set, the market uncertainty about Alibaba will subside. “The execution of this penalty is supposed to allow Alibaba’s share price to regain market attention.”
Alibaba’s Hong Kong shares have been flat so far and have risen 20% in the past 12 months. Its ADR is down 4.5% this year and up 13.7% over the past year.