Sina Weibo skyrockets in debut

(Agencies) Updated: 2014-04-18 07:34

The Weibo logo is seen at the NASDAQ MarketSite in Times Square in celebration of its initial public offering (IPO) on The NASDAQ Stock Market in New York April 17, 2014. [Photo/Agencies]

SAN FRANCISCO - Shares of Weibo Corp rose 19 percent in their US debut on Thursday.

Investors are scrutinizing the biggest debut of a Chinese Internet company in years, hoping for clues as to demand for the highly anticipated IPO of far larger e-commerce giant Alibaba Group Holding Ltd.

Weibo Corp's gains came after the owner of a Chinese Twitter-like messaging service priced its shares at the bottom of a target range of $17 to $19, and cut its offer by 16 percent, to 16.8 million American Depositary Shares from 20 million.

The stock rose as high as $24.48 in the afternoon, briefly valuing the company at about $4.7 billion. It closed at $20.24, up $3.24, at 4 pm in trading on the Nasdaq Stock Exchange.

At $24, near its Thursday high, Weibo Corp is trading at around 26 times 2013 sales, higher than Facebook Inc's 19 times and Chinese Internet search-leader Baidu Inc's roughly 2 times, but still lagging Twitter's multiple of 40.

The strong debut gave fellow Chinese Internet companies a lift. Parent Sina Corp rose more than 6 percent, video-streaming site Youku Tudou Inc was 3 percent higher, and social network RenRen gained 3 percent.

Weibo Corp's sterling debut could pave the way for its peers. Alibaba is expected to file as early as next week for a US IPO that could raise as much as $15 billion. That would make it the biggest internet company IPO since Facebook Inc's $16 billion coming-out party in 2012.