China's Tudou makes Wall Street debut, shares dive

Aug 17, 2011
Pedestrians walk past the New York Stock Exchange in New York City. Shares of China's internet company Tudou fell sharply as the online video company made its debut on Wall Street.

Shares of China's internet company Tudou fell sharply as the online video company made its debut on Wall Street.

Shares in the Shanghai-based company, which raised $174 million with its US initial public offering, were priced at $29.00 on the Nasdaq Stock Market and closed at $25.56, a loss of 11.86 percent on the day.

Tudou, which was founded in 2005 and claims 200 million monthly unique visitors, is trading under the ticker symbol "TUDO." It has a market capitalization of $867 million at the IPO price.

Stephanie Chang of Renaissance Capital said "overall market volatility and risk aversion on behalf of IPO investors" may account for Tudou's slide.

"Though Tudou is an intriguing growth story, it has a high risk profile due to its lack of profitability and the fact that it has lost share to market leader Youku over the past six months," Chang told AFP.

Tudou is the latest Chinese Internet company to look to the US capital market, where investors have been keen to snap up stakes in technology firms based in the world's fastest-growing major economy.

China has the world's biggest Internet population with at least 457 million users.

Tudou rival Youku was listed in New York in December and saw its share price more than double on the first day of trading.

Chinese online dating site Jiayuan and Chinese social network Renren made their debuts on Wall Street in May.

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