On the back of a fast-growing domestic internet population that crossed the 500 million mark last year, Baidu, Tencent and NetEase.com are expected to remain the best-performing companies in the mainland's online sector this year.
They are expected to make solid gains from opportunities in emerging mobile internet and social-networking platforms over the next 12 months, according to an internet investment guide published yesterday by JP Morgan Securities (Asia- Pacific).
The three firms were also the top picks last year for JP Morgan, which pointed out that they 'beat their respective benchmarks by a sizable amount'.
Internet search market leader Baidu, for example, made a return of 8.9 per cent last year, while the Nasdaq was down 1.1 per cent.
Baidu, which has a market capitalisation of US$44.8 billion, is forecast to record a 50 per cent year increase in revenue to US$3.4 billion this year from an estimated US$2.3 billion last year.
The key drivers for its business growth include increased online advertising by large companies, the addition of more social-networking features on its search service, increased mobile internet search activity and greater adoption of its Phoenix Nest advertising system.
Phoenix Nest, which is comparable to rival Google's AdWords in terms of functionality, provides services such as targeted advertising, keyword recommendation, and budget planning and reporting tools.
