As the leading online travel service company in China, Ctrip is a bit embarrassed

recently, the world's largest exchange company Nasdaq OMX Group announced the changes in the Nasdaq-100 index, Ctrip was excluded from the index, replaced by Kraft Food Company. The change will come into effect on July 23, 2012, opening in Monday.

Industry analysis, the elimination of the Nasdaq-100 index does not represent the poor performance of Ctrip, but it can be seen that Chinese consumer stocks in the U.S. stock market has become increasingly unpopular. In addition, Ctrip is also facing a slowdown in profit growth, the new profit point is not clear and so on.

The Nasdaq-100 index is generally revised once a year, announced early in December and adjusted after the third Friday closing in December. Moreover, any time a stock is no longer eligible for the Nasdaq-100 index, it will be replaced by the company that meets the criteria but is not selected for the largest market capitalisation. For example, when a stock's market value is less than 0.1% of the Nasdaq-100 index for two consecutive months, it will be excluded from the index in the third Friday of the next one months. This is the case for the index adjustment.

The price of Ctrip began to fall in the vicinity of the 28 dollar in early March of this year, closing at $18.4 and $16.76 in May and at the end of June, to a close of $15.06 by July 13 and a corresponding market value of about 4 billion U.S. dollars, 2.6 billion dollars, 2.4 billion dollars and 2.162 billion dollars respectively. The continued decline in share prices and the above rules led Ctrip to be excluded from the Nasdaq-100 index.

Yesterday, Ctrip did not respond positively to the matter. Ctrip reported in the first quarter of 2012, net revenue in the first quarter of 911 million yuan (about 145 million U.S. dollars), an increase of 19% per cent, net profit of 169 million yuan, down 28%.

"In the United States listed OTA (online travel), hotels and other companies, such as Art dragon, such as home, Han court, and so on, in the past a period of time, mostly suffered a decline in share prices, and even the company below the issue price. And Ctrip is the only to enter the Nasdaq-100 Index OTA, hotel-related listed companies, the U.S. stock market is mostly institutional investors, now Ctrip is excluded, visible institutional investors in the U.S. stocks on the Chinese consumer concept stocks are not optimistic. "Long-term research on U.S. stocks of Snowball financial analyst Wu Sanmao pointed out that the first half of this year, many Chinese companies in overseas markets, the lack of subscription, it is more visible that Chinese enterprise stocks are not in pursuit abroad."

Reporter in the interview learned that Ctrip as the domestic online tourism leading enterprises, its market share and profitability in the long term is good, but now because more and more competitors into the market, Ctrip began this month also uncharacteristically "into" the price war to scramble for customers, and even announced that it will invest 500 million of dollars for low-cost promotions.

In 2011, Chengying received 3.7 billion yuan, net profit of 1.08 billion yuan. If really put 500 million dollars, is equivalent to Ctrip a year's revenue, this number is too high? Ctrip began to play price war can be seen its competitive pressure, but the price war reflected in the listed company is its traditional air tickets, hotel booking business profits may fall, so Ctrip's profit growth slowed down. But we have not seen the effective profit growth point of carrying threading at present. "Wu Sanmao points out.