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Alibaba Plans to Boost IPO Price on Strong Demand

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Alibaba Plans to Boost IPO Price on Strong Demand

Alibaba Group Holding Ltd, plans to boost the price of its initial public offering amid strong investor demand, people with knowledge of the matter said, potentially making it the biggest in history.

China’s biggest e-commerce company plans to increase the top end of a marketed price range to just below $70, from $66 previously, said one of the people, asking not to be identified discussing private information. The announcement is likely to come later today after the market closes in New York, according to the person.

Alibaba’s decision came even as billionaire founder Jack Ma told prospective investors today at Hong Kong’s Ritz-Carlton hotel he won’t seek too high a valuation, according to two people who attended the meeting. Ma said the company tried to fairly price the November 2007 sale of its business-to-business marketplace Alibaba.com Ltd., whose shares almost tripled on its Hong Kong debut, the people said.

China’s Fraught IPOs

“There was so much demand in the first two days, it’s reasonable to raise the price range slightly,” said Li Muzhi, a Hong Kong-based analyst at Arete Research Service LLP. “The company might want to not be too aggressive on pricing so it can still have some upside after the listing.”

The company is embarking on the second week of its global tour to meet with investors in Asia and Europe as it seeks to convince funds to buy into its offering. Alibaba had already received enough interest for its deal that it plans to stop taking orders for the sale early, people with knowledge of the matter said last week.

Smoked Salmon

Alibaba and its advisers sifted through the orders over the last few days and determined that there was enough demand at the high end of the range that they could raise it, the people said today. Florence Shih, a Hong Kong-based spokeswoman for Alibaba, declined to comment.

Over a lunch today of smoked salmon, breaded chicken and mango pudding, Ma fielded investor questions on the company’s partnership structure, management philosophy and how it will maintain profit margins amid rising competition, people who attended the meeting said.

China’s Richest Man

Ma is seeking to avoid a repeat of Alibaba.com, which plummeted below its IPO price shortly after listing. He ended up delisting the company in 2012 at its IPO price.

Conservative Valuation

Alibaba aims to be a global company and plans to expand its business in Europe, the U.S. and Asia, Ma told reporters before the investor luncheon. Ma, a 50-year-old former school teacher, is China’s richest person with a net worth of $21.9 billion, according to the Bloomberg Billionaires Index.

The company is seeking to list after valuations for technology shares rose to a 4 1/2-year high, data compiled by Bloomberg show. The Nasdaq Composite Index (CCMP) climbed to the highest since March 2000 on Sept. 2, while the Standard & Poor’s 500 Index hit a fresh record three days later and a gauge of Chinese stocks in the U.S. traded near a three-year high.

At the original range, Alibaba’s market value was as high as $162.7 billion, which was conservative relative to peers. At the top end, the company was asking for about 29 times three analysts’ estimates for earnings in the year through March 2015, data compiled by Bloomberg show.

Chinese Internet peer Baidu Inc. trades at about 35 times estimates of this year’s earnings, while Tencent Holdings Ltd. trades at 37 times. A valuation of 35 times would imply a price of nearly $80 a share for Alibaba. Amazon.com Inc. fetches closer to 136 times forecast 2014 earnings.

Final Orders

Even at the previous $60 to $66 price range, Alibaba’s IPO could raise as much as $24.3 billion including an over-allotment option, surpassing Agricultural Bank of China Ltd.’s $22.1 billion sale in 2010 as the world’s biggest.

For U.S.-based investors, final orders will need to be in by 4 p.m. on Sept. 16, while Alibaba will stop taking orders in Asia and Europe during their respective afternoons on Sept. 17, people said last week. Alibaba still plans to set a final price for the shares on Sept. 18, with trading to begin the next day, one of the people said.

Credit Suisse Group AG, Deutsche Bank AG, Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley and Citigroup Inc. are managing the offering. Rothschild is serving as an independent IPO adviser to Alibaba. The company plans to list its shares on the New York Stock Exchange under the symbol BABA.

 

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Petrol Price Hike Looms as Oil Hits $110/barrel

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Nigeria Earns N12.4tn from Crude Oil in 11 Months – Report

Nigeria faces fresh pressure on petrol and diesel prices following a sharp rally in global crude oil prices to nearly $110 per barrel at the weekend.

Already, industry experts are warning that sustained increases could raise domestic fuel costs despite expanding local refining capacity.

For Nigerian businesses, sustained increases in diesel and petrol prices could raise the cost of running generators, transporting goods and operating equipment. Manufacturers, farmers and transport operators could pass some of the additional expenses to consumers, while higher haulage costs could increase the prices of food and other essential goods.

The development, analysts note, presents a dilemma for Africa’s largest oil producer, which stands to earn more from crude exports but remains vulnerable to rising energy costs that could further squeeze households, manufacturers, transport operators and other businesses.

Brent crude, the international benchmark, rose 3.72 per cent to about $109.90 per barrel, while West Texas Intermediate, the US benchmark, gained 3.51 per cent to $101.40 per barrel. Murban crude also advanced 3.08 per cent to $113.40 per barrel, according to market data published by Oilprice.com.

The rally followed escalating geopolitical tensions and attacks on energy infrastructure, heightening fears of supply disruptions and sustained pressure on global energy markets.

Publicity Secretary of the Crude Oil Refiners Association of Nigeria (CORAN), Mr. Eche Stephen Idoko, while commenting on the development, said the central concern was the contradiction of an oil-producing country potentially earning more from crude exports while its citizens remained exposed to higher energy costs.

“Ordinarily, rising crude prices should be good news for Nigeria’s revenues and foreign exchange position. However, the benefits could be substantially undermined by rising costs of transportation, manufacturing, agriculture and ultimately the general cost of living,” Idoko said.

READ ALSO: NIPCO Gas Licences, NNPC Ltd Management Face Reps Probe

He argued that higher crude prices also increase the cost of feedstock for Nigerian refiners, stressing that domestic refining alone cannot insulate consumers from international oil price movements.

According to him, the naira-for-crude arrangement addresses the currency of settlement but does not necessarily reduce the underlying cost of crude oil.

Idoko called for a commercially sustainable domestic crude supply and pricing framework, arguing that local refiners should not have to bear unnecessary logistics, financing and transactional costs associated with crude supply arrangements.

He also questioned how much of the additional revenue accruing to Nigeria from higher crude prices would translate into reducing the structural cost of supplying energy to Nigerians.

For CORAN, he said, the priority should be to strengthen domestic refining competitiveness rather than rely on further government-administered retail discounts or price ceilings.

Idoko noted that there was a real risk of higher fuel prices if crude oil remained at elevated levels, although the extent of any increase would depend on exchange rates, international petroleum product prices, refining margins and domestic supply conditions.

Executive Secretary and Chief Executive Officer of the Major Energies Marketers Association of Nigeria (MEMAN), Mr. Clement Isong, also identified rising international product prices and distribution expenses as potential sources of additional pressure on domestic fuel prices.

In a webinar presentation titled “Structuring Nigeria’s Domestic Market Distribution Framework” delivered at the weekend, Isong said the final price paid by consumers reflected not only international product prices and foreign exchange movements, but also freight, financing, transportation, regulatory charges and distribution costs.

He further warned that rising diesel prices could compound the cost of distributing petrol because diesel is a critical input in road transport and the movement of petroleum products.

According to the presentation, petrol prices rose by 33 per cent to N1,378 per litre between January and October 2026, while automotive gas oil, commonly known as diesel, increased by 36 per cent to N1,853 per litre.

Isong said higher diesel prices increased the cost of transporting petroleum products, including petrol, adding to distribution expenses and wider economic pressures.

The latest crude oil rally could intensify these pressures if it translates into higher international petroleum product prices and replacement costs for refiners and marketers. Any impact on pump prices, however, would depend on movements in international product prices, exchange rates, refining margins and domestic supply conditions.

The pressure on refined products is also being compounded by tight global diesel supplies. According to the market report published by Oilprice.com on October 16, the International Energy Agency warned that diesel supplies could remain tight into 2027, with inventories unlikely to be rebuilt before the third quarter of next year.

Global diesel production reportedly fell by 1.7 million barrels per day year-on-year to 27.2 million barrels per day, highlighting the pressure on supplies of a fuel widely used in transportation, manufacturing, agriculture and electricity generation.

Isong added that Nigeria also needed a more efficient distribution system to minimise avoidable expenses between refineries and consumers.

He recommended that domestic refineries serve as a major source of supply as production becomes commercially available, with imports used to bridge domestic supply deficits through competitive procurement based on the lowest evaluated price.

He also called for predictable bulk supply arrangements, transparent pricing methodologies and better coordination among suppliers, depot operators, transporters and purchasers to reduce operational delays and logistics costs.

The MEMAN chief executive further advocated supply-chain cost reductions, targeted and temporary relief for essential economic activities, and reduced dependence on petrol and diesel through alternatives such as compressed natural gas, electric vehicles and small-scale solar power.

He maintained that efforts to reduce costs should preserve market-based pricing.

Also commenting, energy policy analyst and partner, Bloomfield Law Practice, Mr. Ayodele Oni, posited that Friday’s $110 is not a new crisis.

“Brent topped $120 in April, and Nigerians have already absorbed much of this shock. The real question is whether $110 becomes the floor,”.

Oni argued that in a deregulated market, there is no subsidy buffer, so a sustained rise will reach the pump, warning that if Brent holds above $105 for a few weeks, the recent easing of gantry prices will reverse.

According to him, domestic refining softens the blow by removing freight, import costs and foreign exchange demand for imported fuel, saying without the Dangote refinery, the pass-through today would be far steeper.

“Price shocks come from abroad. Our vulnerability to them is a choice,”.
Courtesy – The Sun Nigeria

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Renaissance Capital Sees Significant Upside in Dangote Refinery, Lifts Valuation by 33.4%

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Leading investment research firm Renaissance Capital Africa (RCA) has upgraded its valuation of Dangote Petroleum Refinery and Petrochemicals (DPRP) to N700.41 per share, implying a 33.4 percent upside from the refinery’s IPO offer price of N525 per share.

According to RCA, the valuation increase reflects the refinery’s exceptional earnings performance in the first nine months of 2026, driven by stronger refining margins and better-than-anticipated operational results. Revenue, EBITDA and net profit all exceeded the firm’s expectations during the period.

READ ALSO: Dangote Refinery IPO Elicits Participation in 90 Countries Globally

In its October 16, 2026, update, titled “Stronger Refining Margins Drive Earnings Outperformance,” the investment firm cited robust refining margins and stronger operating results as key drivers of the enhanced valuation.

The remarkable investor interest comes against the backdrop of the refinery’s strong operational and financial performance. For the nine months ended September 30, 2026, the DPRP reported revenue of US22.5 billion and net profit of US4.7 billion, representing one of the strongest financial performances recorded by an African industrial enterprise in recent years.

The results marked a significant turnaround from the corresponding period in 2025, when the company recorded a loss of US117.2 million. Revenue grew by 144 percent from US9.2 billion, while EBITDA increased nearly nine-fold to US5.5billionfromUS627.6 million. Operating cash flow rose more than ten-fold to US$3.68 billion, underscoring the refinery’s growing ability to generate substantial earnings and cash flow from its operations.

The company also strengthened its balance sheet considerably, moving from a net debt position of US1.73 billion as of September 2025 to a net cash position of US651 million by September 2026, reflecting improved liquidity and financial resilience.

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Dangote Refinery IPO Elicits Participation in 90 Countries Globally

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The Dangote Petroleum Refinery & Petrochemicals (DPDP) has revealed that its ongoing Initial Public Offering (IPO) has attracted exceptional participation from investors across Africa and around the world, with subscriptions received from more than 90 countries, including investors from 51 of Africa’s 54 nations.

The unprecedented level of participation positions the transaction as Africa’s first truly pan-African public offering, reflecting strong investor confidence in African-led industrialization and a growing desire among Africans to own strategic assets built on the continent.

The company noted that the IPO has already set new benchmarks in the capital markets, breaking the Nigerian market record on its opening day and surpassing the previous African record within its first ten days, driven by robust demand from retail investors, pension funds, institutional investors, asset managers, and members of the investing public.

On the milestone, Chief Financial Officer of Dangote Group, Murat Erden, said: “This offering represents far more than a capital-raising exercise. It is a landmark opportunity for Africans and global investors alike to participate in the ownership of one of the continent’s most transformative industrial assets. The extraordinary participation from individuals and institutions across Africa demonstrates a shared conviction that Africans should not only benefit from industrial development but also own and create wealth from it.”

The remarkable investor interest comes against the backdrop of the refinery’s strong operational and financial performance. For the nine months ended September 30, 2026, the DPRP reported revenue of US22.5billion and net profit of US4.7 billion, representing one of the strongest financial performances recorded by an African industrial enterprise in recent years.

READ ALSO: Makinde Fires Back at Presidency, Insists on ₦9tn NLNG Dividend Shortfall

The results marked a significant turnaround from the corresponding period in 2025, when the company recorded a loss of US117.2 million. Revenue grew by 144 percent from US9.2 billion, while EBITDA increased nearly nine-fold to US5.5 billion from US627.6 million. Operating cash flow rose more than ten-fold to US$3.68 billion, underscoring the refinery’s growing ability to generate substantial earnings and cash flow from its operations.

The company also strengthened its balance sheet considerably, moving from a net debt position of US1.73 billion as of September 2025 to a net cash position of US651 million by September 2026, reflecting improved liquidity and financial resilience.

According to Erden, the refinery’s current performance significantly exceeds the assumptions underpinning the IPO valuation. “Our financial performance has already advanced well beyond the baseline assumptions used in determining the IPO valuation. The refinery’s operational momentum, scale and efficiency continue to create substantial shareholder value and reinforce our confidence in its long-term growth prospects.”

In a major boost to African capital-market integration, the transaction has also benefited from pioneering cross-border market collaborations involving Botswana, Egypt, Ethiopia and Kenya, helping to broaden access and reduce barriers to participation for investors across the continent.

The DPDP described the IPO as a powerful demonstration of the increasing sophistication, depth and interconnectedness of African financial markets, providing a blueprint for future continent-wide investment offerings.

The company reiterated that the IPO provides a unique opportunity for investors to become shareholders in one of Africa’s largest and fastest-growing industrial enterprises, with the potential for USD-linked dividends, subject to the company’s dividend policy and applicable regulatory approvals.

With the offer scheduled to close on 27 October 2026, the company has intensified investor education and engagement activities across key markets to ensure broader inclusion and participation. The refinery emphasized that no further extension of the offer period is currently planned.

On the significance of the transaction, Erden added: “We are witnessing the emergence of a new chapter in African industrial ownership and capital-market development. The overwhelming response from investors across 51 African countries and more than 90 countries globally is a resounding vote of confidence in Africa’s future and in the ability of world-class African enterprises to deliver sustainable value for shareholders.”

The company expressed appreciation to regulators, stockbrokers, issuing houses, financial institutions, fintech partners, community leaders, investor associations and the investing public for their support and participation throughout the offer period.

 

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