Alibaba.com Ltd, the mainland's top e-commerce firm, said its third-quarter profits soared 49 percent as a growing number of smaller businesses worldwide turned to the cyber-market to buy and sell products to cut costs.

However, the firm, in which Yahoo has a 39 percent stake, holds a pessimistic outlook for the coming year due to the global economic recession. It also plans to buy back up to HK$2 billion of its own shares through the end of next year.

The Hangzhou-based company saw its third-quarter profits rise to 308.6 million yuan, from 207.3 million yuan a year earlier, the company said yesterday in a statement to Hong Kong stock exchange. Its sales soared 37 percent to 780.2 million yuan.

David Wei, chief executive officer, said more mainland companies have started using Alibaba's website to find domestic buyers as the financial turmoil eroded overseas demand for shoes, toys and electronics. The operator, which introduced a cheaper subscription this month to lure customers, hasn't seen a slowdown this year, he added.

"Our top priority is user and customer growth, and we didn't change that, no matter if the economy is good or bad," he said.

Analysts predict Alibaba is likely to cater to more and more small- and medium-sized enterprises (SMEs) on the mainland amid the economic downturn and tightened bank loans.

Alibaba said it started offering "starter-packs" with subscription fees as much as 60 percent lower than current services subject to market conditions.

It had 35.6 million customers at the end of September, up 10 percent from three months earlier.

Outside the mainland, the US is the biggest user with 17 percent of Alibaba's registered users at the end of June, according to the company. India accounted for 9.6 percent, the European Union 9.1 percent and the UK 5.8 percent, it said.

Shares in Alibaba ended 0.21 percent higher yesterday at HK$4.8, much lower than its initial public offering price of HK$13.5. Its initial share sale in Hong Kong last November was ranked by investors and brokerages as one of the city's most popular IPOs ever.

The stock has tumbled as much as 83 percent so far this year, compared with a 49.5 percent decrease on the benchmark Hang Seng Index, amid fears on its premium membership and dismal outlook for the world economy.