(Yicai Global) Aug. 30 -- Pinduoduo, a Chinese e-commerce startup of just four years, has pushed its market cap ahead of tech giant Baidu to become the country's fifth-largest internet firm by market capitalization.
Its share price [NYSE:PDD] surged 8.66 percent to USD33.61 yesterday, taking its gains this year to date to almost 50 percent and setting a new record high price for the Shanghai-based firm's stock. Its market cap reached USD39.1 billion, placing it one spot below JD.Com's USD44.9 billion among Chinese internet companies. Baidu's is USD36.5 billion.
Pinduoduo got off to a shaky start when it listed in July 2018, plummeting to an all-time low USD17.22 after surging nearly 30 percent to USD24.60 during its debut, and it has been a rollercoaster ride ever since.
It had its biggest one-day gain in nine months on Aug. 22, with shares surging 16 percent to USD30.11 the day after the firm revealed in its interim report that second-quarter revenue had nearly tripled on the year to CNY7.3 billion (USD1 billion), beating expectations by about CNY1.1 billion. It also narrowed its net loss 85 percent to CNY1 billion from CNY6.5 billion.
The improvement could be a result of Pinduoduo's newfound attraction in China's better-developed urban areas. The company was renowned for being popular among price-sensitive shoppers but buyers in the country's first- and second-tier cities made up 48 percent of gross merchandising volume in June, according to Chief Executive Zheng Huang. That was up from 37 percent in January.
Editor: James Boynton