DEFINITION of 'BATX Stocks'

BATX is an acronym for the four most popular Chinese technology stocks: Baidu, Alibaba, Tencent and Xiaomi. The term came into existence much like that of the FAANG stocks acronym, top U.S. technology stocks namely Facebook, Apple, Amazon, Netflix and Alphabet’s Google. BATX was coined around the time when the leading Chinese smartphone maker Xiaomi announced its plans to list on the Hong Kong Stock Exchange during July 2018, and represents the Chinese tech firms' increasing global clout. (See also, How Xiaomi Makes Money?)

BREAKING DOWN 'BATX Stocks'

BATX is made up of NASDAQ-listed Baidu Inc. (BIDU), NYSE-listed Alibaba Group Holdings Ltd. (BABA), OTC Markets-listed Tencent Holdings Ltd. (ADR) and HK-listed Xiaomi Corp.

Collectively, these four technology giants are digital innovation leaders in China. While they cater to the needs of individual users through their various offerings, they are also leading the way for revolutionizing industries and sectors through their products and services.

BATX companies were nurtured in the shadow care of the Chinese government that often installed barriers for their western counterparts such as Google and Facebook preventing them from freely operating in the world’s most populous nation. BATX companies are often called the Chinese twins of their western counterparts. While government support has helped the BATX companies to grow regionally, these companies have seized opportunities to expand globally.

BATX companies are not only growing organically, but also making strategic investments at global levels. With millions of users in global markets and more than 150 direct global investments and acquisitions, BATX companies have gained a strong foothold in American, European and Asian markets. For instance, in November of 2017, Tencent spent $2 billion to buy a 12% stake of Snap Inc. (SNAP). It represents the fifth largest investment involving a Chinese firm acquiring a stake in a U.S. tech firm. While Uber lost ground to Didi Chuxing in China, Alibaba and Tencent (via Didi Chuxing) invested in Uber-competitor Taxify in August last year to intensify the competition in Europe. In July last year, Baidu purchased Kitt.ai, an American startup specialized in natural language and artificial intelligence (AI). (See also, 10 Companies Owned by Alibaba.)

Together, the four BATX companies command a market capitalization of around $1.1 billion as of July 2018. The firms have collectively incubated more than 1,000 new ventures over the past decade. They are actively catering to more than 20 different sectors. Their operations facilitate both online and offline offerings and are increasing big in hardware electronics. They’ve had an average annual growth exceeding 50 per cent, and are growing exponentially across multiple sectors.

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