"In its initial document, Alibaba said it was raising $1 billion, but that is only a placeholder and will surely change. Demand from investors is likely to be high and analysts have estimated that Alibaba would raise $15 billion or more at a valuation of close to $200 billion."
200B valuation is actually very reasonable: it's PE would be roughly 35 compared to Amazon's 400. Now the big question which I have not been able to figure out from their S1 is why they have so much more margin compared to Amazon, given the two are operating more or less in the same space. Is that because US is a free (and more efficient) market, where China has more artificial barriers for other players?
I think Alibaba does more bulk shipments, connecting manufacturers. Alibabas' customers are businesses, Amazon is a consumer company. They are not comparable at all. Searching for pens on Alibaba gives you offers with minimum shipment of 500 pens.
Alibaba's model (in eCommerce) is very different from Amazon's. Alibaba is only the middle-man platform, and doesn't keep its own inventory or warehouse.
I would have assumed more like $20-30B.