Baidu's Qunar targets end-2016 profit as Alibaba expands

Qunar Cayman Islands, a Chinese travel website, forecast its first profit as a public company in the fourth quarter of 2016 as competition intensifies and Alibaba Group Holding expands.

For next year, marketing costs would continue to rise in line with sales, while headcount expenses would be under control, chief executive Zhuang Chenchao said, the first time the firm, controlled by Baidu, has given a timeframe to turn profitable.

"If we can properly deliver our strategy, we will be profitable at the end of 2016," Zhuang said.

"When Alibaba started their travel business, we at that time had a small amount of money and Alibaba was already a few-billion-dollar company," Zhuang said. Qunar had proven that "we're able to put in place the right strategy, and we're able to execute it".

Fresh with cash from a US$25 billion initial public offering in September, Alibaba is making a renewed push to expand in online travel through acquisitions and investments. It agreed to pay 2.8 billion yuan (HK$3.5 billion) for a 15 per cent stake in Beijing Shiji Information Technology, a hotel management-system provider, its first investment after floating on the stock market.