Dangdang.com (DANG) Takes NYSE by Storm - Other Chinese IPO Stocks to Follow

Dec 8, 2010 -

Since 1999, Dangdang.com has been focusing on selling books via e-commerce methods in China. Inspired by unorganized New York bookstores, Peggy Yu and her husband started Dangdang.com in hopes of creating an organized online bookstore. Since then it has become the largest bookseller in China and that is taking into account both stores online and brick and mortar shops. 

This was done through understanding the customer's needs and wants. Also, Peggy reduced the learning curve through learned lessons from other existing companies such as Bertelsmann book club and Amazon. However, Amazon has since entered the market through an acquisition of a local Chinese company (Joyo).

With all this hype, last year (2009) Dangdang made a mere $2.5M USD profit. It also recorded losses in 2007 and 2008. Dangdang faces tough competition with other top online retailers including Vancl. While its competitors have focused on building market share, Dangdang has been focused on making profit. Despite all of this, stocks were up 87% today from its IPO offering amount of $16 USD.

If anything, I'd imagine you'd want to play the hype. In that case, Lentuo International Inc. (LAS) and Sky-mobi Ltd. (MOBI) are due to sell shares tomorrow. LAS is an Chinese auto dealer and  MOBI is a Chinese mobile application company. LAS posted a profit of approximately $10M USD last year. Whereas MOBI posted a loss of $8M USD.

Disclosure: I do not own DANG for my accounts. 

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