'Chinese YouTube's' shares fall in disappointing debut

A pedestrian walks past the company logo of Tudou located outside its headquarters in Shanghai. Photograph: Aly Song/Reuters

The Chinese video sharing website Tudou saw its shares fall on its Wall Street debut as it became the first company to go public since last week's market turmoil.

Shares in Tudou, dubbed the Chinese YouTube, opened at $24 each on the Nasdaq stock exchange, down 12% on their $29 asking price. The company was down 8.3% at 1pm in New York, or 6pm UK time.

The disappointing debut comes as investor appetite for new public listings in general wanes in tumultuous trading conditions. But it also comes after investors raised concerns about accounting measures at recently US-listed Chinese firms.

Tudou, which is based in Shanghai, raised $174m (£105m) after pricing its shares on Tuesday evening. The company was valued at $2.8bn after its Nasdaq debut.

However, Tudou's bigger rival, the Chinese video website Youku, was one of the top gainers on Wall Street on Wednesday as its stock rose 12%.

Shares in Youku, which went public in December 2010, swapped hands at almost $27 apiece in early afternoon trading on the New York Stock Exchange.

Tudou has doubled its number of registered users in the past two years, to 90 million at the end of June. However, the six-year-old company's losses have widened. Its net loss in the three months to 31 March was $52m on revenues of $12.1m.

Credit Suisse, Deutsche Bank Securities and Oppenheimer & Co were the underwriters on the Tudou IPO.