Baidu's Bet On Travel Search Site Proves Profitable

The successful listing of Chinese travel-deal search site Qunar has proven that China's top search engine Baidu made a smart investment by buying a stake in the company two years ago, the website of the 21st Century Business Herald reports.

Qunar's floatation of its American depository receipts in New York on Nov. 1 surged by 89.5% to close at US$28.4 during its debut, up from its offer price of US$15.

On Qunar's listing day, Baidu saw the value of the stake it owns in Qunar jump to US$1.75 billion, when it had only spent US$306 million to acquire the site's shares two years ago.

Despite the dilution of shares following Qunar's listing, Baidu remains the largest shareholder of the travel search site, as the search engine still owns a 58.9% stake.

With the online travel business' bright prospects in China, Baidu formed a close partnership with Qunar, although the travel site posted losses in both 2011 and 2012.

Although Baidu has made a successful investment in Qunar, as well as in web portal Hao123 and video site iQiyi, the 21st Century Business Herald pointed out that the search giant has not had the same luck with its ventures in e-commerce.