Traders wait for Chinese online retail giant Alibaba's stock to go live on the floor at the New York Stock Exchange in New York on Sept 19, 2014.[Photo/Agencies]

Alibaba's IPO in New York in September 2014 was the world's largest, raising more than $25 billion. More than 10 million merchants are active on its online platforms. The e-commerce giant announced its annual sales for the fiscal year ended March exceeded 3 trillion yuan and overtook Wal-Mart Stores Inc, making it the world's largest retailer.

But the IPO aspirants will find the going a lot tougher than that, in spite of their boundless enthusiasm and energy. Fair valuations for a diverse range of e-commerce firms with intangible assets are not easy to obtain because such assets are not readily recognized by regulators and investors.

Huang Song, a professor at Peking University's Financial and Industrial Development Institute, said there is no roadmap for such firms to follow, which means an online merchant's journey toward an IPO could be bumpy.

"For instance, IPO applicants are required to get their earnings audited. But, when it comes to online retailers, it's hard to tell at which time incomes become realized as revenue," he said.

"Sometimes, an online retailer adds a transaction to revenue when the parcel is sent off on delivery, and sometimes the transaction gets booked as revenue when the buyer receives the parcel."

Many of online retailors rely on external online marketplaces such as Tmall from the Alibaba stable, product suppliers and manufacturers. Even if they go in for a float, there is high chance that their businesses would be undervalued by investors, said an expert from China Merchants Securities Co Ltd, a brokerage based in Beijing, who sought anonymity.

"Moreover, some of the online merchants may have exploited some loopholes in law to secure better business performance, such as faking their sales records. Some may have avoided paying tax. But going public requires them to open their tax books. If they didn't do it right, their dirty laundry would be seen by public," said the expert.