Baidu's travel site makes strong IPO
Updated: 2013-11-04 11:22
By Amy He in New York (China Daily USA)
|
||||||||
Qunar Cayman Islands Ltd, the travel website of Chinese Internet giant Baidu Inc, traded almost double its initial share value on Friday on its opening day, raising $167 million.
Qunar, which means "where are you going" in Chinese, offered 11.1 million American depositary shares at $15 each, more than the expected $12 to $14 range, which was higher than the company's initial target of $9.50 to $11.50 per share for its initial public offering.
Trading under the symbol QUNR, shares opened at $28.35 and at one point hit a high of $34.99. The stock closed at $28.40, an 89.3 percent jump. Goldman Sachs Group, Deutsche Bank and Stifel Financial Group were the lead book-runners for the sale.
Founded in 2005, the Beijing-based Qunar aggregates information from thousands of travel agencies, flight routes and hotels to give customers discounts when they book. Baidu, China's largest search engine, purchased a majority stake in the company for $306 million in 2011.
"Going public is an important milestone for Qunar in our company's history," said Qunar CEO Zhuang Chenchao at the closing ceremony on Qunar's opening day.
"However, our IPO is just the start of the journey and we are going to continually build our system to redefine the Chinese online traveler user experience, and to redefine the whole industry," he said. "With funds raised in the public market, we will be able to offer more [products], best-value deals and services at your [fingertips], anytime, anywhere."
After being plagued with accounting scandals, Chinese companies are making their comeback in the US stock markets and Qunar's debut was strong, analysts say.
"Whenever [a stock] doubles in a day, I would say it exceeds expectations," said Tim Hanson, senior analyst at Motley Fool Asset Management.
"Qunar is obviously operating from a [strong] position, just right ahead of the gate, of having Baidu as a major backer," he said. "Baidu is obviously a known quantity, has a very premium valuation now, people have a lot of respect for [CEO] Robin Li."
The Baidu name makes Qunar a much safer stock option, Hanson said, than it would be if the company were coming out on its own. But even on its own Qunar has shown increasing revenue and dramatically narrowing losses, so investors probably foresee profits coming quickly, he added.
Hanson cautioned that there is still volatility in the Chinese economy that will affect the market, despite optimism about Chinese Internet companies.
For now, Qunar had a "relatively easy IPO" and it launched into a "strong environment," one where investor demand for Chinese Internet names is strong, said Hanson.
(China Daily USA 11/04/2013 page2)
- US carrier starts Philippine storm relief
- Treasures under the hammer
- 'Reverse' vending machine sells idea of recycling
- Heroic act helps thaw icy ties
- Newtown families mark anniversary with a plea for parents to unite
- China's changing fashion since 1978
- Healthy baby born to brain-dead mom in Hungary
- Top 10 romantic places to meet your Miss Right
Most Viewed
Editor's Picks
Intl attention on reform agenda for China |
A second opportunity |
Luxury giants tap into mainland market |
Aiming for 100,000 |
Tourism opens the road to riches |
Ancient, modern under same roof |
Today's Top News
US treasury chief makes 2nd trip to China
Nobel prize winner's connections with China
Canada should think globally: official
CCA buys on Hudson riverfront
US spying agencies out of control
Yancoal strides into the potash game
Green chance offered to investors
Searching in Shanghai
US Weekly
Geared to go |
The place to be |