Shares in Alibaba, Tencent seen surging
Domestic tech giants like Alibaba Group Holding have seen their share prices grow much more quickly than many global tech leaders like Facebook in 2017. Experts noted that the surge was supported by the companies' outstanding market competence in China, but a low level of internationalization is what keeps them behind the likes of Apple and Google.
Alibaba reached $144 per share by 10 p.m. on Monday, compared with $87.81 by the end of 2016, up about 64 percent.
JD.com's share price also surged, rising by about 69 percent from $25.44 by the end of 2016 to $43.05 by 10 p.m. on Monday.
Shares in Tencent Holdings and NetEase Inc rose to HK$284 ($36.35) and $327.5 per share, respectively, by 10 p.m. on Monday, up 52 percent from HK$189.7 and 55 percent from $215.34 at the end of last year.
Meanwhile, Facebook and Amazon have seen their shares rise by about 18 percent and 34 percent, respectively, this year.
According to media reports, the combined company value of the five major tech firms in China - Alibaba, Tencent, Baidu, JD.com and NetEase - currently accounts for about one third of the total for the five biggest tech firms in the U.S. - Google, Amazon, Apple, Microsoft and Facebook - the highest level in more than 30 months.
Baidu losing ground
Experts the Global Times talked to on Monday said that domestic tech giants' rocketing share prices are normal, given their solid business performance, particularly Alibaba and Tencent.
Tencent's revenue surged by 55 percent year-on-year to 49.55 billion yuan ($7.23 billion) in the first quarter, while Alibaba saw its revenue reach 32.15 billion yuan, up 60 percent on a yearly basis.
"Just have a look at 'King of Glory,' a mobile game developed by Tencent that gained more than 200 million users over a short period of time - this is a clear reflection of the market competence of Tencent," Liu Xingliang, head of the Data Center of China Internet, a Beijing-based Internet research organization, told the Global Times on Monday.
However, Liu Dingding, an independent tech analyst, said that the outstanding stock performance by certain domestic tech giants does not represent the whole picture, as many tech companies in China are actually having a mediocre year in 2017 in terms of stock performance.
For example, Baidu Inc saw its share price rise to $180.77 by 10 p.m. on Monday compared with $164.41 by the end of 2016, up by only 9.95 percent.
According to Liu Xingliang, the "BAT" (short for Baidu, Alibaba and Tencent) industrial composition is evolving, with Baidu gradually losing its momentum, while Alibaba and Tencent are becoming stronger.
"Alibaba and Tencent have both taken advantage of their main strengths, with Alibaba monopolizing e-commerce and Tencent grasping the largest market share for mobile Internet services. Unless new companies can grasp the next Internet trend, whatever it may be, this industrial structure is not likely to change for at least 10 years," Liu Dingding told the Global Times on Monday.
Gap still there
According to Liu Dingding, there's still a gap between domestic tech giants and global ones like Google, although the gap is getting narrower.
By Friday, Apple was valued at $768 billion, while Google's market valuation reached $677 billion. In comparison, Alibaba was valued at $364 billion, and Tencent at $338 billion.
"The biggest gap between domestic tech giants and companies like Apple and Facebook lies in how internationalized they are," Liu Xingliang noted. "Although Alibaba and Tencent have made a lot of efforts in this direction, I don't think their efforts have been successful so far."
As long as Alibaba and Tencent fail to make greater headway in their global business, the gap with companies like Google will remain, he said.
