SHANGHAI, April 12 The head of China's largest
search engine Baidu Inc cautioned Chinese Internet
companies on Tuesday against listing overseas in haste,
describing the market as "hot".
In a speech at the company's Baidu Union Summit, Robin Li,
the charismatic founder of Baidu, warned Chinese entrepreneurs
not to be taken in by the interest in China's Internet market
and to instead focus on developing good products.
"I believe there will be a listing frenzy this year; a
frenzy of Chinese Internet companies wanting to list overseas,"
Li said. (here)
"You must remember that listing is not a means to an end, it
is only a means of business development," Li said to an audience
comprised of Baidu affiliates, partners and entrepreneurs.
Chinese Internet stocks have become darlings of Wall Street,
with online video company Youku.com Inc , e-commerce
website operator E Commerce China Dangdang Inc and
online security firm Qihoo 360 Technology Co Ltd
posting huge first-day IPO gains.
Li, whose company posted a first-day jump of more than 300
percent in 2005, said Chinese Internet companies looking to list
must focus on building up their products and their operations.
"Don't be fooled by the apparent prosperity of the industry.
What is important is how much you can achieve ... and whether
your products are attractive. So don't be dazzled by sudden
changes in the market, which is on fire" Li said, adding that
history had shown that many predictions on hot Internet sectors
in the United States and China had turned out to be duds.
However, Li advised companies close to listing overseas to
do so soon to benefit from prevailing positive sentiment for
Chinese Internet companies.
China, the world's largest Internet market by users, is home
to about a dozen dynamic, large but unlisted entities such as
Alibaba Group's Taobao and 360buy.com.
One of China's larger social-networking-sites, Renren, also
has plans to list this year. Yet, analysts have said sky-high
valuations and unsteady business models could lead to a Chinese
"In light of what will be a very hot market this year, my
advice is to be still in the midst of the noise," Li said.
(Reporting by Melanie Lee; Editing by Chris Lewis)