TENCENT HOLDINGS ADR (OTCMKTS:TCEHY) opened with a nice gap up and managed to maintain the upside for the day as it finished the last trading session with a gain of 2.63%. The volume of the day at 1.6 million was almost double the daily average of 832,000, reflecting the interest the investors have been showing in the stock in the recent times. The stock has rallied a lot from the October low around $16.40 levels with most of the price action contained in a rising channel. The upside breakout of the channel signals increasing bullish momentum but the next couple of sessions must provide the confirmation.
TENCENT HOLDINGS ADR (OTCMKTS:TCEHY) along with Baidu Inc (ADR)(NASDAQ:BIDU) and e-commerce firm Alibaba Group Holding Ltd (NYSE:BABA) holds dominant position in Chinese internet market. The three firms are popularly known “BAT.” Also, they are termed as “Google of China” due to their significant presence in market share search. Tencent is a leader in social media market while Alibaba is pioneer in e-commerce segment.
The dominance
Tencent, Alibaba and Baidu are the three big players of internet market in China. They are the leading firms with remarkable presence and massive funds and are feared by entrepreneurs. The companies possess the power to mark losers and winners from the list of startups.
The three entities are making sizeable investments to expand their market share in the growing Smartphones market. Their measures have made them into leaders among Chinese startups. There are divided views regarding the impact of three companies on startup firms. Some state that these three companies do not allow startups to flourish while some see them as supporters providing with exit options.
The expert comments
Jack Ma of Alibaba expressed that in recent years he was told that his company along with Baidu and Tencent were believed to be the beneficiaries of big opportunities in China. Some people even claimed that due to the dominance enjoyed by the three firms, it was almost impossible for startups to survive in the Chinese internet industry.
Ma stated that they will continue to extend their market share in the growing internet industry in China. At the same time, startup firms will also have equal chances to make their name in the market. “BAT” always implements initiatives to encourage entrepreneurs to mark their presence in the internet segment. Raven Tech expressed that initially venture capitalists were reluctant to provide funds to startups due to the dominance held by BAT, particularly Baidu.
