Asian internet stocks..."darlings"...KOREA,CHINA,PCNTF...
Friday December 17, 4:49 am Eastern Time
INTERVIEW-More web IPOs seen in China next year
By Lee Chyen Yee
BEIJING, Dec 17 (Reuters) - China may see about five of its web firms going public next
year, and they are likely to list on Hong Kong's new second board rather than on Nasdaq,
Internet industry officials said on Friday.
''Next year, we might see about five Internet companies from China getting listed,'' Wang
Shu, International Data Group Technology Venture Investment's vice president in Asia Pacific, told Reuters.
Wang said although it was every Internet company's aim to list on the prestigious Nasdaq board, many firms might pick Hong
Kong's new Growth Enterprise Market (GEM) for a first listing because it has less stringent criteria.
''U.S. investors understand the Internet market best. But a Nasdaq listing requires more money and the company needs to be
reasonably established,'' Wang said.
''But most Chinese Internet firms are not ready yet, so Hong Kong will be a more realistic choice in terms of policies and
regulations,'' he said.
NEW YORK VS HONG KONG VS TOKYO
Hong Kong launched GEM on November 25 to give access to capital markets to young and promising firms that might not
qualify for the main board of the Hong Kong Stock Exchange.
But China's Internet companies with Nasdaq dreams might not have to look that far next year as Japan's Softbank Corp said in
November it hoped to start up Nasdaq Japan by the end of 2000.
But Wang said language might be a hindrance.
''Going public in Tokyo has more barriers than getting a Nasdaq listing. Language will be a problem. If I were to pick a Asian
exchange, I'll probably choose Hong Kong to Tokyo,'' Wang said.
China.com (NasdaqNM:CHINA - news) became the first Chinese web portal to be listed on Nasdaq earlier this year, inspiring
other firms such as e-auctioneer Netease and web portals Sohu.com and Sparkice, which plan to follow suit.
China.com, a Hong Kong-based Internet portal company, made a hugely successful initial public offer in July at $20. On
Friday, it was trading at around $95.
Netease said in July it planned to a listing in mid-2000, possibly on Nasdaq, while Sohu.com has also said it wants to offer
shares next year.
Sparkice said in May it was eyeing a listing on Nasdaq or GEM to raise $100 million.
ASIA'S INTERNET STOCKS A DARLING
''One of the reasons why Asia's Internet companies are doing so well in the United States is because they are in short supply,''
Li Shan, managing director of Lehman Brothers in China, told Reuters.
''There are only these few Asian Internet companies to pick from -- China's China.com, Seoul's Thrunet
(NasdaqNM:KOREA - news) and Singapore's Pacific Internet (NasdaqNM:PCNTF - news),'' Li said.
And he said he was positive the bull run on Asian Internet stocks would continue, given their better valuation than U.S.
counterparts.
''I don't think Asia's Internet stocks are overpriced or it's a bubble that is going to burst,'' Li said.
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