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Sina plans second stock listing
2002/02/08

Beijing - Despite surging sales, China's loss-making Internet portals are still struggling to cope with the highly unpredictable market. In the latest strategy to boost profits, NASDAQ-listed Sina.com plans for a second stock listing as well as the acquisition of local businesses.

According to Sina's chief executive Daniel Mao, the company has been working for a long time towards a second listing on the Hong Kong or even the domestic Chinese stock markets. However, he did not disclose a deadline for the proposed initial public offering (IPO), China Daily reports on Friday.

Sina is also looking for cooperation with local firms, especially traditional industries and IT businesses, to strengthen its operations. It even considers starting its own TV program or magazine, or providing content to existing off-line media, Reuters writes on Thursday.

The main reason to head for the mainland or HK stock markets is a poor NASDAQ valuation, analysts told the China Daily. Thus, due to its great popularity among Chinese users, Sina's stock price on a domestic exchange would most likely be substantially higher than its price on NASDAQ.

Main rivals Sohu.com and Netease.com do as well show a poor performance on NASDAQ. Shares of the big three portals all trade around US$1, significantly lower than their IPO prices of between US$13 and US$20 per share, Reuters reports.

According to the news agency, the portals - all looking for ways to boosts revenue - are in a dilemma. "To an extent, they just can't go around and change their business model like that, because they will come under a lot of fire from shareholders. But at the same time, it's pretty obvious that just with the original business models that they were going to go ahead with, they were not going to get very far", Reuters quotes an anonymous analyst from Hong Kong.

Both Sina and Sohu, currently engaged in a copyright-war, published their latest financial reports this week. The increasing popularity of SMS (Short Message Services) seems to be the main incentive for surging quarterly sales. Sina's revenues grew 12 percent in the last quarter of 2001, compared to the previous quarter. In the same period, Sohu saw its profits rise 15 percent compared to the previous quarter.

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