Qihoo 360 Technology Co Ltd (NYSE:QIHU) has gained popularity among companies going public at Hong Kong Stock Exchange in the past two weeks. The Beijing-based Internet giant is the most popular antivirus provider in China. It has also forayed into the Internet search business, challenging Baidu Inc (ADR) (NASDAQ:BIDU).

Qihoo 360

Qihoo 360 Technology invests in three companies going public

In the last two weeks, Qihoo 360 Technology has become a cornerstone investor in three Hong Kong IPOs. It has committed to purchase stakes in a social video platform, a telecom retailer and a property management firm, reports Prudence Ho of The Wall Street Journal. As a cornerstone investor, the Chinese Internet giant is required to hold on to its stake in those companies for at least six months after they have gone public.

Qihoo 360 Technology is investing $5 million in Tian Ge Interactive Holdings, which plans to raise about $208 million in the offering. It will pour in $20 million in the $153 million listing of Beijing Digital Telecom, which is the biggest mobile phone retail chain in China. Qihoo 360 is investing $10 million in the $122 million IPO of the property management firm Colour Life Services Group.

Qihoo 360 Technology spent $210 million on investing activities in Q1

Qihoo 360 Technology’s investment in Tian Ge is no surprise. Qihoo’s variable-interest entity (VIE) holds 49% stake in a Tian Ge subsidiary, the social video platform revealed in its listing prospectus. But the company’s decision to become a cornerstone investor in the IPOs of Color Life and Beijing Digital is quite surprising. It’s difficult to understand why these two companies fit into its investment philosophy.

A solid cash reserve is one of the reasons Qihoo 360 Technology is so aggressively investing in IPOs. As of March 2014, the company holds $902 million cash, up from $301 million last year. In the first quarter of this year, the company spent $210 million on “investing activities,” up from $59 million in the same period last year.