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Alibaba's plan to split its business into six units has ignited a surge in its share prices, as investors anticipate brighter business prospects due to more accurate development goals and a more efficient management system.

On Wednesday, Alibaba's share price soared by 12.23 percent to $HK 94.55 ($12) on the Hong Kong bourse and 14.25% to $98.39 per share on US markets, the highest point in over a month.

As of press time, the group's US shares rose by 0.78 percent to $99.2.

According to a report of zjol.com.cn on Wednesday, Alibaba's CEO Zhang Yong has announced a new round of corporate governance reforms in a letter to staff. The restructuring will see Alibaba break into six organizations, Cloud Intelligence Group, Taobao Tmall Commerce Group, Local Services Group, Cainiao Smart Logistics Group, Global Digital Commerce Group, Digital Media and Entertainment, marking the most important organization change for Alibaba in 24 years.

Zhang said that qualified business groups and companies will have the possibility of independent financing and listing in the future.

The announcement of those reforms also came on the heels of Alibaba's founder Jack Ma Yun's return to the Chinese mainland.

Xi Junyang, a professor at the Shanghai University of Finance and Economics, said that investors are more confident in Alibaba's future business prospects. The overhaul will provide clearer development targets for each business sector and increase management efficiency, Xi said.

"I think this is a necessary result for the company with such a wide scope of business areas to avoid bloated management system and increase management efficiency," Xi told the Global Times.

Liu Dingding, a Beijing-based tech industry observer, also told the Global Times recently that the move will make the Alibaba Group much more agile when dealing with new opportunities and risks in the market. Moreover, more people within the group could rise up and play a crucial role in their corresponding business sectors.

Liu also noted that the recent stock performance indicates that investors are anticipating and supporting this restructuring, and he suggested that some of Alibaba's business sectors, particularly Cainiao and Cloud Intelligence Group, might pursue independent initial public offerings.

While some overseas media interpreted this news as a signal of China's easing of its "crackdown" on online giants such as Alibaba, Xi explained that China's internet platform management is not aimed at suppressing the development of these companies, but at preventing risks associated with the rapid growth of the internet sector.

"Such management is not targeting any single company," Xi said, adding that if any platform's innovation violates regulatory frameworks, regulators will intervene and tighten management again in the future.

Global Times