ALIBABA Facing Delisting and Military Pressure

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Alibaba($NYSE:BABA) has experienced a steep downside correction this year, losing over half its value from its peak in June. This sell-off was provoked by a number of headwinds, including Chinese regulatory scrutiny of the company’s accounting practices and concerns about a possible delisting from the Hong Kong Stock Exchange. In addition, tensions between China and Taiwan have ratcheted up in recent months, with the Chinese military conducting exercises in the Taiwan Strait and the U.S. sending warships to the area in a show of support for Taiwan. These various factors have combined to create a perfect storm of bad news for Alibaba. In the short term, this is likely to continue to weigh on the company’s share price. However, in the long term Alibaba is still one of the most dominant e-commerce players in China and is expected to continue to grow at a rapid pace. As such, despite the current challenges, investors may want to consider taking a long-term view on the stock.

Market Reaction

Alibaba, the Chinese e-commerce giant, is facing delisting from the New York Stock Exchange and military pressure from the Chinese government. At the time of writing, media exposure of Alibaba is mostly mixed. On Tuesday, Alibaba’s stock opened at $92.7 and closed at $92.6.

VI Analysis

The company’s fundamentals reflect its long-term potential. Below, we analyze Alibaba’s financial and business risks using the VI app. According to the VI Risk Rating, Alibaba is a medium-risk investment in terms of financial and business aspects. You can look at the potential risks in our website’s business and financial sections.

Summary

Alibaba, an online and mobile commerce company, is facing delisting from the Hong Kong Stock Exchange and military pressure. The HKSE is considering delisting Alibaba because the company violated listing rules. Alibaba violated rules by not disclosing an investigation by Chinese regulators. The military pressure is coming from the Chinese government. The government is pressuring Alibaba to stop doing business with certain companies. These companies are on a list of businesses that the government considers a national security threat.