Tudou IPO Set to Stumble Out of the Gate 土豆上市首日难有精彩表现

By newsdoug on August 17, 2011

Note: To readers of my postings in English, I’d like to apologize for the original version of this article, which said the IPO would value Tudou at $3.2 billion. That figure was taken from a Financial Times article which, it turns out, vastly overstated Tudou’s market cap, which should have been $822 million. I’ve recast the posting slightly in light of that error and taken out the Financial Times link, but I do stand by my previous assessment that the IPO will be a dud on its debut.

I’m getting a bit weary of writing about video sharing site Tudou (Nasdaq: TUDO), which might consider changing its company description to “master of media manipulation” to reflect the way it has cleverly leaked a steady stream of rumors into the market to try and create buzz about its upcoming IPO. After a tumultuous Tudou IPO set to tumble out of the gate week that saw rumors of at least 3 potential buyers for Tudou in the Chinese media (previous post), the company has finally gone ahead and priced its IPO in the middle of its indicated range, scuttling any potential for a last-minute buy-out of the company. Media are reporting that Tudou’s IPO pricing gives it a market cap of $822 million, about a third of that for rival Youku (NYSE: YOKU), whose shares doubled after its IPO late last year but have given back most of those gains since then. (English article; Chinese article) Youku’s shares actually fell 8 percent in Tuesday trade on Wall Street, reflecting investor disappointment that it wasn’t able to engineer a last-minute acquisition of Tudou that Tudou chairman Gary Wang was never really serious about to start with. I’m expecting Tudou’s shares to fall on their Wednesday trading debut, as the market I doubt there is much demand for this money-losing company that is a clear number-two in its sector to Youku, although its underwriters who should be commended for generating interest in the offering despite dismal market conditions. Once its price stabilizes, I’d look for Tudou, which lost $12 million in the second quarter, to quietly fade from the headlines and get back to the business of trying to turn profitable.

Bottom line: Tudou’s stock will falter on its trading debut, and will fail to attract much investor interest over the longer term.

关於视频分享网站–土豆网的文章，我都写得有点儿腻了。土豆网或许可以考虑把公司介绍变成“媒体操控大师”，因其巧妙地向市场放出一系列传言，为其即将到来的IPO造势。据中国媒体近期报导，至少有三个潜在买家有意购买土豆网。现在土豆网终於扬帆前行，将IPO价格定在预估区间的中间值，消除了被收购的可能。媒体报导称，据发行价计算，其市值将为8.22亿美元，约为竞争对手优酷网<YOKU.N>市值的三分之一。优酷网去年年底上市，股价曾上涨约一倍，但随後便回吐了多数增幅。优酷股价周二下挫8%，反映出投资者的失望情绪，因其未能收购土豆网，而土豆网董事长王微并不真心想进行此项交易。我预计土豆网股价在周三的首个交易日将下挫，因我怀疑市场是否对这家亏损企业有很大兴趣。土豆在视频分享领域位列第二，仅次于优酷。在目前市场人气低迷的情况下，承销商能为其IPO赢得足够的认购热情亦颇值得赞许。一旦其股价稳定，我预计那时的土豆网不再会受到媒体太多关注，而其将专心实现盈利。

一句话：土豆网股价将在首个交易日下挫，且在较长时间内投资者很难对其有较大兴趣。

Enjoy this blog? Please spread the word :)