Sydney, May 12 1999 (Bloomberg) --

Travel.com.au  Ltd.,  the first Australian online travel company to trade publicly, set the pace for other Internet hopefuls when it rose more than 155 percent above its A$1.25 a share issue price.

The stock reached a high of  A$3.19 giving it  a market capitalization  of A$128 million. Investors bid for up to ten times the amount of shares offered. The company sold 18.8  million shares, or  44 percent of   its capital, raising A$23.5 million. The stock closed at A$2.94.

Australia is already ranked third as measured by Internet use per person, behind the U.S. and Finland, and analysts say  the success of Travel.com.au's trading debut will encourage more Internet companies to go public in Australia.

There are probably about five to ten Internet IPO's banked up in Australia, and quite a few are  in the  applications area,'' said Marc Phillips, director of Internet research firm APT Strategies Ltd.

Sydney-based  Travel.com.au acts as a  travel agent on the Internet, mostly for outbound travel to Australia and sells fares to customers at a lower price than charged by airlines. The company, which is forecasting losses of A$2.7 million in 1999  and A$4.9 million in 2000, is aiming to take business from traditional travel agencies.

Australia's regular Internet users, which number 1.7 million, doubled last year,  and that rate is expected  to continue in 1999.  Sales from electronic commerce are below  A$100 million  though  International   Data Corporation says by 2002 sales will exceed A$16 billion in Australia.

The success of Travel.com.au's  public debut  follows another strong Internet debut in the U.S yesterday. Shares in New York-based financial news provider The Street.com Inc. tripled to US$60 on its first day of trading

Online Boom

Travel.com.au plans to launch a Japanese version of its web site by the end of 1999,  as part  of a transaction to  invest up to A$5 million   with  the Australian unit of Itochu Corp.

It's also in talks with U.S.-based Excite Inc., the No. 2 Internet search company, which has an alliance to develop eleven web sites in  the Asian region with Sydney-based Internet media company LibertyOne Ltd.

We've had some talks with Excite. There may be some opportunities there across Asia with Itochu and LibertyOne, but we have ongoing talks with various search  engines  and media  companies to provide content,'' Travel.com.au Chief  Executive  David  Tonkin told the Bloomberg Forum.

Travel.com.au. has gained No.1 ranking ahead of online travel services offered by rivals such as Telstra Corp., the nation's No. 1 telecommunications company, and OzEmail Ltd., now owned by U.S.-based MCI Worldcom Inc., and ranked as   Australia'sNo. 2 Internet service provider behind Telstra.

The organizing broker to the share sale, Ord Minnett Group, estimates Travel.com.au  could  be making profits in  2002,  if it gets annual sales of A$250 million,  while Tonkin  said   the   company  expects to  achieve  an upsurge in sales in 2001 as more Australians use online services.

Broad Based

Travel is one of the most popular applications because it's so broad-based, said Phillips.

Kerry Packer, Australia's richest man, is also hoping to benefit from strong demand for  Internet  stocks.  His public vehicle,   Sydney-based Publishing & Broadcasting Ltd. plans to sell up to 20 percent of its online unit, ecorp, in the next few months.

Ecorp's  main  business  is  its  50   percent  owned  joint  venture  with Microsoft Corp, ninemsn, which delivers news, sport and entertainment from PBL's television and magazine businesses. Analysts have valued ecorp at A$400 million,  though have said  it could have an opening market value of A$1 billion if PBL proceeds with the share sale.

In November,  Australia's first  Internet media   company, Sydney-based LibertyOne Ltd. raised A$40 million in an initial share sale. Its shares have risen  20 percent to  91 cents,  though  a  share   split  was  announced  in February after the stock had surged   50 percent in its first three months of trading.

Travel.com.au's major stockholders include U.S. student travel company USIT, which owns 26.5 percent of stock, while Tonkin owns 8 percent. Chief Operating officer Bill Gair also owns about 8 percent, while Chief Information Officer David Uptowns about 7 percent.