Deutsche Bank analyst Alan Hellawell launched
coverage of Baidu this morning with a Buy rating
and a $211 price target. Moreover, he says a
“blue-sky scenario” yields a valuation of $432.
Hellawell notes that the Chinese search market is
a duopoly, with 62% market share for Baidu, and
28% for Google; he also notes that the market is
“still nascent,” and should grow 37% compounded
through 2012. “Baidu is poised not only to continue
dominating online search but will have significant
leverage to expand its footprint across the Internet
economy” via network effects, brand equity,
technology and monetization advantages and its
sales distribution network.”
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