Chinese internet company Tencent plans to be more competitive in China’s online market after a US$1 billion investment in its e-commerce platform.

Tencent says the massive investment will allow it to focus on managing its business in China’s large and fast-growing consumer e-commerce industry. The new e-commerce business, to be chaired by Tencent president Martin Lau, will strengthen social networking services, embrace the expanding global online games market, extend presence in mobile internet, integrate online media platforms, nurture search business, build out e-commerce platforms, and enhance capabilities to incubate new businesses.

Tencent, whose businesses include business-to-consumer platforms, consumer-to-consumer platforms, group shopping, mobile internet and tourism, achieved a total revenues of RMB9647.9 million (US$1.5328 billion) in this year’s first quarter, 21.8 per cent  above the fourth quarter of 2011. Its various online platforms include instant messaging QQ, web portal QQ.com, QQ game open platform under Tencent Games and multi-media social network Qzone.

“We have now established a solid foundation in China’s e-commerce industry with significant presence in different e-commerce formats, such as B2C, SME2C, lifestyle services and group buying. We will continue to invest prudently but consistently in our e-commerce business, and leverage our unique advantages, with the aim of building a substantial business over the long-run,” the company said.

 Tencent’s new investment is the second largest investment among Chinese e-commerce companies after 360buy who made a US$1.5 billion investment in April last year.

Financial services firm JPMorgan Chase & Co forecasts China’s e-commerce transactions to increase 42 per cent to US$173 million this year. Online sales are also expected to reach US$159.4 billion by 2015, said Forrester Research.

GB