Earlier this year, the price of the Chinese travel search engine Qunar (QUNR) had been a roller coaster. Qunar's ADR surged 20% within three days following the report of an increase in travel reservation on mobile devices. Its share then plunged about 16% on worries that an increase in online travel discounts will erode profits.
The price war among Chinese Online Travel Agencies (OTAs) has already last for 18 months, yet Qunar continued to show rapid growth. Based on the characteristics of the Chinese travel market, I believe that Qunar is going to survive or even benefit from the price war. Moreover, the The Zhixin Agreement with Baidu (BIDU) will lead to a strong...
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