Alibaba must be every investment banker’s dream. Last year, the Chinese internet commerce group took its business-to-business unit Alibaba.com private. Then it raised funds to buy back about half of the 40 per cent Alibaba stake owned by Yahoo. Now expectations are mounting for a full listing by 2015.

But there is good reason for all this activity. The shake-up is a response to the changes that have taken place in China over the past decade. Alibaba.com first emerged to capture surging exports, connecting traders at home and abroad. But today the bigger growth opportunity is right on its doorstep – the world’s largest internet market, where online shopping is booming. Alibaba’s consumer-to-consumer site, Taobao, dominates this market, with over 90 per cent of sales. In addition, its Tmall site accounts for half of the business-to-consumer segment. Finally, Alibaba owns the leading third-party online payment system, Alipay, as well as a handful of smaller websites. The new direction of the group is clear: Jack Ma, the group’s founder, will hand over the reins to a younger successor on May 10, Taobao’s 10th birthday.

Yahoo’s Alibaba stake fetched $7bn last year, valuing the group at $35bn. That looks about right. According to Yahoo’s third-quarter earnings, Alibaba Group’s net income of $780m for the first nine months puts it on track for full-year earnings of $1bn.