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Latest business news and financial news from E-Commerce China Dangdang Inc. (DANG) by Business expert on China’s market Doug Young

Alibaba’s Etao Faces New Merchant Revolt

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E-commerce leader Alibaba Group looks set to soon get its long-awaited wish for separation from major stakeholder Yahoo (Nasdaq: YHOO), but it won’t have much time to celebrate as new fires seem to be popping up everywhere for nearly all of its major businesses. The latest crisis for the increasingly embattled company has cropped up at its Etao search site, which Alibaba is trying to build up as a specialist in e-commerce searches that can eventually rival online search titan Baidu (Nasdaq: BIDU). Chinese media are reporting that Etao has confirmed that it is no longer indexing search information from sites for a number of major online retailers, including general merchandiser Dangdang (NYSE: DANG) and electronics giant Suning (Shenzhen: 002024) (Chinese article). The confirmation comes just a week after another leading e-commerce site, 360Buy, hinted it may block its pages from Etao searches (previous post), and indeed 360Buy was among the new list of confirmed companies whose pages will no longer be indexed by Etao. With all these major online retailers blocking their material from Etao searches, and the list likely to grow, Alibaba must certainly be worried about the future viability of Etao as a true e-commerce search engine. This latest crisis follows an uprising earlier this month by independent merchants on Alibaba’s B2C platform, Taobao Mall, after the site sharply hiked its fees. That same group of merchants, which has been wreaking havoc on the Taobao Mall site, later moved its rabble-rousing campaign to Alibaba’s electronic payments site, Alipay, as well. (previous post) While all of these crises rage, Alibaba got a rare piece of good news as domestic media reported that Yahoo is looking to sell its 40 percent stake in Alibaba, as the US web giant tries to dispell broader talk that the entire company itself is for sale. Alibaba has long clamored for Yahoo to sell the stake amid friction between the two companies, so clearly it should be happy about this news. But with all the crises now happening in its own businesses, Alibaba won’t have much time to celebrate and indeed might wish it had an ally to help it in this time of trouble.

Bottom line: Alibaba may soon get its official independence from major stakeholder Yahoo, but it won’t have time to celebrate as it faces an escalating crisis at its Etao search site.

Related postings 相关文章:

◙ Albaba Faces New Assaults From Merchants, 360Buy 阿里巴巴受到中小商户和京东商城的双重夹攻

◙ Taobao Mall’s IPO March Collides With Merchant Uprising 淘宝商城IPO或因商户“起义”被推迟

◙ Alibaba Sharpens Focus in Yahoo Buy-Out, Taobao Mall 阿里巴巴回购雅虎所持股权有望

News Digest: September 24-26, 2011

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The following press releases and media reports about Chinese companies were carried on September 24-26. To view a full article or story, click on the link next to the headline.

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◙ China Communications Construction eyes $3.1 billion Shanghai IPO (English article)

◙ Lenovo (HKEx: 992) Lowers Price on A1 Tablet PC to 1,000 Yuan, May Start Price War (Chinese article)

◙ Dangdang (NYSE: DANG) Announces Fulfillment Developments, New Head of Technology (PRNewswire)

◙ ZTE (HKEx: 763; Shenzhen: 000063) Officially Launches Skate 4.3-Inch Smartphone Globally (Businesswire)

◙ Silvercorp (NYSE: SVM) Sues Chinastockwatch.com Alleging Attempt to Drive Down Shares (English article)

More Internet Froth in Alibaba Valuation, Dangdang Price War 阿里巴巴估值奇高凸显网络泡沫

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The latest signs of froth in China’s bulging Internet bubble are popping up in several places this week, with new investors in e-commerce leader Alibaba Group boasting a ridiculously high valuation for the company, while the latest price war by Dangdang (NYSE: DANG) underscores the overheated competition. And in perhaps the most revealing of the new developments, even state-owned dinosaur CCTV is jumping on the e-commerce bandwagon, with the launch of its CNTV Mall. (English article) Let’s begin with Alibaba, which has received new investment from a group of blue-chip investors including Singapore’s Temasek, private equity firm Silver Lake Partners and Russia’s Digital Sky Technologies (DST), which are boasting their investment values the company at as much as $32 billion. (English article) This sounds ridiculous for a company that analysts were estimating was worth around $10 billion just months ago, and is reminiscent of DST’s estimate earlier this year shortly after it and others invested $1.5 billion in e-commerce site 360Buy that that company was worth up to $10 billion. (previous post) I wouldn’t be surprised if DST was the one giving the $32 billion figure for Alibaba, and would advise DST’s chief Yuri Milner to take a course in remedial finance before throwing out more such overinflated numbers in the future. In terms of Dangdang, the company is reportedly pressuring consumer electronics companies that sell on its site to lower their prices below those of comparable products on 360Buy, in a campaign that a Dangdang insider says has been named “operation decapitation”. (English article) The name of the campaign itself reflects the hyper competition that has appeared in China’s e-commerce space following the infusion of billions of dollars in new investment over the past year. But the biggest sign of a bubble in my view is the arrival of China Central Television, better known as CCTV, to the market. You know that when a slow-moving dinosaur like CCTV finally joins the game, the party is almost over.

Bottom line: A sky-high new valuation for Alibaba Group and the latest cut-throat campaign from Dangdang are the latest signs of a looming burst for China’s Internet bubble.

本周种种迹象表明，中国互联网泡沫正在成形。阿里巴巴市值被投资者吹捧到高得离谱，当当网(DANG.N)近期打响价格战凸显行业竞争白热化。最能说明问题的莫过于CCTV也进军电子商务领域，推出中国网络电视台商城（CNTV Mall）。首先，来谈谈阿里巴巴。该集团近期获得多家蓝筹投资机构投资，包括新加坡淡马锡控股、私募公司Silver Lake Partners及俄罗斯风投公司数字天空科技（DST）。这些机构称，他们对阿里巴巴的投资，促使该公司市值高达320亿美元。这听起来十分荒谬，因为仅在数月前，分析师估算的阿里巴巴市值仅为100亿美元左右。这不禁让人想起今年早些时候，DST与沃尔玛和百度向京东商城投资15亿美元后不久，就对京东商城估值100亿美元。如果是DST提供阿里巴巴市值320亿美元的数据，我一点也不会感到惊讶，我会建议，DST执行长米尔纳（Yuri Milner）以後夸大这类数据前，应先学会补齐财务知识。有报导称，当当网正向其消费电子产品供应商施压，要求其售价应低于京东商城同类产品，当当网内部人士透露，此举被命名为“斩首行动”。这一名字本身就反映了中国电子商务行业竞争白热化的现状。该领域过去一年来获得了数十亿计美元的新注资。但我认为，中国互联网泡沫的最大迹象是CCTV进军该市场。要知道，像CCTV这样行动缓慢的庞然大物加入时，游戏就基本结束了。

一句话：对阿里巴巴集团估值过高，当当网启动“斩首行动”，这些都是中国互联网泡沫破裂的最新迹象。

Related postings 相关文章:

◙ Muddy Waters, Taobao Mall Wake Up to China E-commerce Hype

◙ 360Buy IPO: Let the Delays Begin 京东商城放缓IPO进程

◙ Wal-Mart Finds Bargain in China’s Internet Bubble

News Digest: September 22, 2011

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The following press releases and media reports about Chinese companies were carried on September 22. To view a full article or story, click on the link next to the headline.

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◙ Dangdang (NYSE: DANG) Plans 3C Price War Against 360Buy – Source (English article)

◙ Lenovo (HKEx: 992) Passes Acer (Taipei: 2353) As World’s Third Biggest PC Seller (Chinese article)

◙ Sino Agro Food Clears SEC Comments on its Form 10 Registration Statement (Businesswire)

◙ Baidu (Nasdaq: BIDU) Invests in Group Buying Cosmetics Site 36tuan – Source (Chinese article)

◙ Shanda’s (Nasdaq: SNDA) Ku6 Media (Nasdaq: KUTV) Quits Video, Tries SNS (Chinese article)

News Digest: August 4

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The following press releases and media reports about Chinese companies were carried on August 4. To view a full article or story, click on the link next to the headline.

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◙ China Telecom (HKEx: 728), Apple (Nasdaq: AAPL) In Preliminary iPhone Deal – Source (English article)

◙ Tudou Plans to Raise $120 Mln in US IPO This Week – Source (Chinese article)

◙ Elavon (NYSE: USB) and China UnionPay Reach Processing Agreement (Businesswire)

◙ Sina Corp (Nasdaq: SINA) to Report Q2 Financial Results on August 17 (PRNewswire)

◙ Dangdang (NYSE: DANG) to Report Q2 Financial Results on August 16 (PRNewswire)

Sofun’s New Strategy: Dividend Wave Ahead? 搜房网新策略：中国概念股派息潮即将来临？

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Several US-listed China firms have launched recent share buybacks to boost stock prices hit by the ongoing confidence crisis (previous post), but real estate services leader Soufun (NYSE: SFUN) is taking a different and interesting approach by offering a dividend, in what could be a sign of things to come. (company announcement) Soufun said it will pay a dividend of $1 per share under its new plan, equating to a generous return of nearly 5 percent based on the company’s share price when the plan was announced. Despite rising as much as 5 percent on Monday after the announcement, Soufun shares ended the day down 2 percent, reflecting both investor skepticism about China stocks as well as Soufun’s own prospects due to a pending correction in China’s overinflated real estate market. The tepid response aside, this kind of move looks much smarter to me than previous buybacks launched by the likes of Spreadtrum (Nasdaq: SPRD) and Dangdang (NYSE: DANG), as it provides some concrete rewards for investors compared with the less tangible rewards from a share buyback. Many of the larger New York-listed Chinese firms are sitting on huge cash piles already that they don’t know what to do with, and this kind of return of money to investors — especially if Soufun decides to make its dividend an annual event — could be just the kind of reassurance investors would like to see to give them at least a little protection against economic and accounting concerns. While initial response to the dividend seems a bit disappointing, I’d look to see how Soufun’s shares fare over the next week or two before passing final judgment. If the stock outperforms the market, which seems like a strong bet, I wouldn’t be surprised to see some of the other major US-listed Chinese firms with big cash reserves launch their own dividend plans, in an effort to win back skeptical investors with similar cash returns.

Bottom line: Soufun’s new dividend plan, providing an immediate 5 percent return to investors, could lead to a new round of similar dividends from US-listed Chinese firms looking to prop up their shares.

多家在美上市的中国企业纷纷回购股票，以提振遭信任危机重创的公司股价。但中国房地产服务领头羊搜房网<SFUN.N>采取的策略与众不同，很有意思：派息。搜房网宣布现金派息计划，决定每股普通股派发一美元股息，按照计划宣布时公司的股价，此举相当於近5%的收益。尽管派息计划宣布後，搜房网股价周一上扬5%，但当天其股价收跌2%，既反映出投资者对於中国概念股的忧虑，也反映出对於搜房网前景的怀疑。尽管市场反应不温不火，我认为这种策略要比之前展讯通信<SPRD.O>和当当网<DANG.N>等企业的回购做法聪明得多。因为派息对投资者的回报更为直接，而股票回购则没有那麽明显。很多在纽约上市的中国较大企业根本不差钱，而且不知道钱怎麽花。而这种回馈方式可能正是投资者所需的一种安慰，在经济与会计忧虑中至少对投资者起到一点保护作用。虽然市场对派息的初步反映有些令人失望，但我会密切关注未来一到两周搜房网的股价表现，然後再做定论。如果搜房网跑赢大盘，一些其他在美上市的中国企业也推派息计划，让疑虑重重的投资者重拾一些信心，我不会感到意外。

一句话：搜房网的派息计划可能会令其他在美上市的中国企业跟进，掀起一股派息潮。（

Related postings 相关文章:

◙ 55tuan Scraps Listing Plan After Banks Get Cold Feet 各投行临阵退缩 “窝窝团”放弃赴美上市

◙ China NY Stocks on Cusp of Comeback? 中国赴美上市公司股票即将触底反弹？

◙ China Confidence Crisis Separates Wheat from Chaff 中国企业信任危机 对不同公司各有利弊

Taobao Mall Takes Hit with Drug Sale Ban 中国规范网络售药 或重创淘宝商城

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Alibaba’s Taobao Mall, the B2C portion of Taobao that was split off into a separate entity under a restructuring last month (previous post) looks set to take a hit, as China moves to clean up its unruly pharmaceuticals industry by banning the sale of drugs online. (English article) The campaign looks very much like similar ones that Beijing has launched from time to time, and in particular resembles a drive a few years back to stop hospitals from making bogus claims through advertisements. That campaign saw traditional and new media companies like Focus Media (Nasdaq: FMCN) and Sina (Nasdaq: SINA) suffer as hospitals and clinics, in search of more revenue as they were freed from state support, had become some of the biggest buyers of advertisements at the time. It’s hard to say how big the impact will be on Taobao from this latest drive to regulate drug sales, but I’m guessing such sales probably comprise a fair share of its transaction volume, probably somewhere in the 5-10 percent range. The loss of commissions from such sales won’t be devastating, but will certainly deal the company a setback, especially as it prepares for in IPO which I expect will come in the next year as Taobao investors, most notably Japan’s Softbank, clamor for some return on their investment. The ban could also have an impact on some other e-commerce sites, though many of the big ones, such as Dangdang (NYSE: DANG) and Vancl, seem to be steering clear of the drug sector and focusing on less controversial products like books and clothing. Still, this latest ban is just the latest reminder that nothing in China is certain, either online or offline, and these kinds of periodic “clean-ups” can hit just about anyone at any time.

Bottom line: Alibaba’s Taobao Mall will take a hit with China’s latest crackdown on online drug sales, taking away some of the company’s momentum as it prepares for an IPO as soon as next year.

中国正对网上售药进行治理，以规范药品行业，阿里巴巴旗下的淘宝商城料将受到影响。这与中国政府以往不时推出的行动很像，尤其是几年前，因为医院和诊所改制，不再得到国家资金支持，为寻找创收渠道，部分医院诊所成为广告商最大客户之一，而当时，政府发起禁止医院打广告夸大药效的行动，让分众传媒（Focus Media）<FMCN.O>和新浪<SINA.O>等媒体公司遭重创。很难说这次规范药品行业销售行动对淘宝的影响有多大，但我猜测，淘宝的交易额将受到一定影响，比例可能在5-10%左右。此类销售的佣金损失不会是毁灭性的，但肯定对淘宝商城不利，尤其是该公司正准备上市。我预计，由於淘宝投资者，尤其是日本软银，急於获取投资回报，公司将在明年上市。这一禁令也可能影响到其他电子商务网站，但当当网<DANG.N>和凡客诚品等许多大型平台正清除售药类别，重点发展图书和服饰等争议较小的产品。但此事提醒我们，在中国没有什麽是确定的，无论是线上还是线下，这些不时进行的“严打行动”可能在任何时间，影响到任何人。

一句话：中国近期严打网络售药，阿里巴巴旗下的淘宝商城或受创，在公司准备进行IPO之际，可能对其造成一定影响。

Related postings 相关文章:

◙ Taobao Split: Separating Wheat From the Chaff 淘宝一分为三 如何取其精华

◙ Alibaba, Tencent Join Mobile OS Bandwagon 阿里巴巴和腾讯进军移动操作系统领域

◙ Alibaba, eBay Lovefest Over as eBay Rethinks China 阿里巴巴和eBay的蜜月期结束