The website of the People's Daily, the propaganda arm of the Chinese communist party, has received an overwhelming vote of approval from the market in its initial public offering.
In the first listing of the editorial arm of a government news organisation in China, the online unit of People's Daily raised Rmb1.38bn (USD 219 million) in Shanghai, nearly triple its fundraising target.
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Beijing hopes that it will lead the way to similar IPOs, with the internet portal of Xinhua news agency up next, raising cash to boost the appeal of state-run media. Bids covered more than 60 times the amount of shares on offer, as investors scrambled for a slice.
The strong performance reflected optimism that the People's Daily, founded in 1948, will be able to modernise and close the gap with private internet companies such as Sina and Tencent, which have built much more popular news websites than their stodgy government-run rivals.
In global terms, the People's Daily appears strong - it will rank just behind the New York Times in terms of valuation. People.cn's market capitalisation will be USD 876 million based on the float, while the New York Times is valued at about USD 943 million.
But within China, the People's Daily faces more competition than ever. Long gone are the days when the Communist party's mouthpiece was essential reading. Instead, a bewildering array of websites, business publications and foreign titles vie for attention.
The People's Daily website was 49th in visitor numbers in China last year, according to internet monitoring organisation ChinaRank.
"We need to increase our popularity, expand the range of products and services we offer, reach a wider audience and increase page hits per visitor," People's Daily said in its IPO filing.
It said it would use the funds it had raised to upgrade its technology and expand its web-based products.
Valued at 46 times its 2011 earnings, the People's Daily website will trade at a multiple that is nearly 5% higher than the industry average for Chinese media companies.
"Given the government background and the fact that it's both new media and mainstream media, it has a promising outlook," said Qian Qimin, an analyst with Shenyin Wanguo Securities.
However, technology alone will not be enough to make People's Daily a top website. The nature of the challenge was laid bare by news coverage decisions on Friday.
The top story on People.cn was government-mandated fare: 'The outstanding achievements of our country's cultural reform'. Sina, a commercial news website with roughly ten times more visitors, featured a blog post about a district government that hired a 20-year-old cadre, news that had outraged - and enticed - ordinary readers.