Internet stocks can climb more

Internet stocks can climb more
Kim Se-yoon

MARCH 3: Share prices of Internet-related firms have further room to climb considering the potential value of the companies, an executive with Japanese high-flying Internet investor Softbank Corp said on Friday.

"It's natural that the value of Internet-related firms is high, and they have room to go higher," said Yoshitaka Kitao, chief financial officer for Softbank. "Considering the future value of the technology-related firms, the prices have not reached a bubble level."

Rising numbers of Internet users, including the total number of users in Japan reaching more than 20 million this year, would contribute to Internet firms posting larger profits, Kitao said.

In Japan, Softbank was looking to invest in more than 2,000 Internet-related companies soon using the 150 billion yen fund it planned to set up this month, he said.

Regarding investment in South Korea, Kitao said Softbank was now seeking to invest in non-Internet-related firms. "We plan to set up a separate fund at Softbank Finance and are looking to invest in (Korea's) offline companies and transform their business to online," Kitao said. Softbank Finance is a wholly-owned unit of Softbank Corp.

The Japanese Internet powerhouse in December set up a joint venture with capital of 100 billion won to invest in Korea's rapidly growing Internet business market. Softbank Corp is also the largest shareholder in online brokerage E.Trade Korea, holding a 40 per cent stake. The brokerage began operations early February.

US number two online brokerage E.Trade Group holds 10 per cent in the Korean joint venture. The remainder is the held by individual investors and South Korea's LG Investment and Securities. South Korean industry sources say more than 40 percent of stock trading is done online in the country, the largest percentage in the world.

Kitao said Softbank would not force its units to list on Nasdaq Japan, which is expected to be launched in June. "Any qualified companies, whether they are related with Softbank or not, will be able to list on Nasdaq Japan," he said.

"But we will not force any of our units to be listed on Nasdaq Japan." Nasdaq Japan Planning is a joint venture between the National Association of Securities Dealers (NASD) and Softbank.

The planned launch of Nasdaq Japan has sparked competition to lure young and promising firms among Japanese stock markets, including the over-the-counter market and the Tokyo Stock Exchange's newly opened Mothers market for start-up companies.

Mothers market, hastily established in what is widely seen as a pre-emptive strike against Nasdaq Japan, has seen only three firms go public since its debut in December. Softbank said earlier it planned to float online brokerage E.Trade Japan, a joint venture with E.Trade Group, on the Nasdaq Japan exchange in the third quarter.

Yahoo Japan, crown jewel of Japan's over-the-counter market, said last month it would consider whether to debut on Nasdaq Japan after trading rules and listing standards were finalised. Yahoo Japan became the first Japanese stock ever to trade above 100 million yen in January. Softbank has holdings in more than 300 companies, most of which are net-related, including a 51.2 percent stake in Yahoo Japan.