Mobile Internet products and services provider, Sungy Mobile, begins trading on the NASDAQ Global Market on November 22, 2013. [Photo by Bai Jie / For China Daily]

Sungy Mobile Ltd, a mobile Internet services company, made its debut on the US stock market Friday with an IPO valued at $78.5 million, as IPO activity involving Chinese companies picks up after a two-year lull tied to accounting scandals and a regulatory dispute.

"The stock went up today and everybody's happy", CFO Winston Li told China Daily in an interview. "We are doing this because we love mobile Internet. Taking the company public is our shareholders' wish and we think it is a good way to raise our profile."

Guangzhou-based Sungy is best-known for its GO Launcher EX app, which creates a wide variety of options for Android-based smartphones. Its apps, most of which are free, have a collective 325 million downloads globally with 87 million monthly active users, 70 percent of whom are outside of China.

The company's services and products also include a mobile reading service, a mobile Internet portal, as well as clocks, calendars and task managers.

The Nasdaq Stock Market listing under the "GOMO" ticker symbol capped off two years of revenue growth and the company's first year in the black. The company reported a profit of nearly $10 million on revenue of $37.58 million for the nine months ended September 30.

The listing shows customers they "are using products and services from a reputable public company", Li said.

Seven million shares were priced at $11.22, the high end of the expected range of $9.50 to $11.50. The stock began trading at $14.11, or 26 percent above the offering price. At one point, the shares soared to $16.11, up 44 percent.

By the time company founder and chairman Deng Yuqiang rang the closing bell in honor of the company's IPO, the issue ended at $13.35, up 19 percent.

The number of Chinese companies going public on the US stock market has picked up in recent weeks after accounting scandals and a dispute between regulators in both countries produced a chilly investment climate for the group. Aggressive scrutiny of Chinese companies by US short-sellers such as the Muddy Waters research firm has caused share prices of US listed Chinese companies to plunge, new capital flows to dry up and dozens of Chinese firms to desert the US stock market. The targets have included Standard Chartered PLC, Focus Media and American Tower Corp.

Li said Sungy went to no special lengths to assure the investment community the company's accounting practices were problem-free. "Our business is very straightforward," he said. For instance, he said, "users just pay" for access to the digital literature in the company's mobile reading service. "We don't have any accounting issues," Li said.

The SeekingAlpha investor research website said Sungy's "graceful" conversion of its "massively increased revenue" into profitability signaled "quality executive and management performance". It also saw the company's having 70 percent of its GO Launcher customers outside China as a plus, given what it called "arbitrary" Internet usage rules in China.

However, Seeking Alpha said the company will have its work cut out for it going head-to-head with industry titans Google and Facebook, who produce "similar" products.

"Both of those competitors have capitalization, resources, and name recognition superior to GOMO," Seeking Alpha said. "There is no guarantee that other major web firms will not attempt to produce competing products in the future, given the proliferation of Android phones and the profits that current players have generated".

Sungy was co-founded in 2003 by Yuqiang Deng, a former China Telecom and China Mobile engineer, and Xiangdong Zhang, a one-time manager with electronic commerce company China Dangdang Inc. Deng now holds the title of CEO; Zhang is president.

Li said the company will use the proceeds to invest in research and development and hire staff to help it stay abreast of the changes in the fast-developing mobile Internet business.

"The industry is developing very quickly and new things are coming out on almost a daily and weekly basis," Li said. "We need to keep investing to grow within the industry".

Sungy's revenue and profit growth reflects the increasing appetite for mobile services in China and beyond, he said.

"China has a big population and the Chinese population is getting richer by the day," Li said. "They want to enjoy the conveniences of modern life. The cellphone is something that came from a luxury item to a necessity. People are now on the go and they go everywhere. They may not take other things with them, but they always have cellphones. With your cellphone in the past you always made phone calls. You do text messages. With today's technology with a cellphone, you can do anything".

michaelbarris@chinadailyusa.com