Vipshop Holdings Ltd. (VIPS), the Chinese web retailer that sells brands from Calvin Klein to Nike at a discount, is handing investors the best returns among foreign companies that went public in the U.S. this year as slower growth in the Asian nation stokes demand for low-cost items.

“Vipshop has a business model that works favorably even when the economy slows,” Donghao Yang, the company’s chief financial officer, said by e-mail Dec. 14. “U.S. investors recognize the value of a company like Vipshop that can deliver strong top and bottom line improvement consistently.”

Shares of Vipshop have surged 124 percent since the Guangzhou-based firm’s March initial public offering. The jump topped gains for the 17 other non-American companies that debuted on U.S. exchanges in 2012, and compares with a 44 percent advance in Israel’s Caesar Stone Sdot Yam Ltd. (CSTE), which ranked second, data compiled by Bloomberg show. Vipshop’s rally beats the 6.4 percent 2012 increase in the Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese shares in the U.S.

Vipshop has surged since September to surpass its IPO price, after having to sell shares below target in the offering as demand for Chinese stocks in the U.S. faltered. The stock climbed 19 percent last week to a record $14.56 Dec. 14. Vipshop was one of three Chinese companies to undertake IPOs in the U.S. this year, down from a peak of 42 in 2010. The government cut China’s annual growth target to the lowest since 2004 in March as the slowing U.S. and European economies sap demand for the nation’s exports.

‘Strong Momentum’
YY Inc. (YY), the operator of an online social network that is also based in Guangzhou, has jumped 30 percent to $13.65 since Nov. 21, when it raised $94.2 million at $10.50 per American depositary receipt. Acquity Group Ltd. (AQ), a Hong Kong-based company which has most of its customers based in the U.S., has declined 3.3 percent to $5.81 from its April IPO price of $6.

Vipshop’s outperformance was driven by the company “delivering on revenues and earnings growth,” Josef Schuster, founder of Chicago-based Ipox Schuster LLC, which oversees about $2 billion, said by e-mail Dec. 14. “Vipshop is likely to continue its strong momentum as long as growth rates can be maintained.”

The company, whose discount site for branded fashion is similar to Gilt.com in the U.S., is “right on track” after posting positive adjusted net income in the third quarter for the first time since the business started in 2008, CFO Yang said in a Nov. 14 interview.

Solars Rally
The iShares FTSE China 25 Index Fund, the biggest Chinese exchange-traded fund in the U.S., surged 1.8 percent Dec. 14 to a nine-month high of $39.34, extending gains last week to 2.4 percent. The Standard & Poor’s 500 Index fell 0.4 percent on Dec. 14 to 1,413.58, ending the week down 0.3 percent, amid concerns over federal budget negotiations in the U.S.

Trina Solar Ltd. (TSL) -- China’s third-largest maker of solar panels, based in Changzhou -- surged 34 percent last week in New York, leading gains in solar stocks. Trina and Yingli Green Energy Holding Co. (YGE) were chosen to receive government aid as the nation offered a second round of subsides for more than 100 new energy projects.

SolarCity Corp. (SCTY), the San Mateo, California-based solar power provider led by billionaire Elon Musk, jumped 47 percent in the two days after raising $92 million in its Dec. 12 IPO.

“Chinese solar companies are benefiting from SolarCity’s IPO and strong debut trading,” Aaron Chew, a senior analyst with Maxim Group LLC that rates Trina and Yingli hold, said by phone from New York Dec. 14. “But it won’t help change the industry fundamentals.”

LDK, Suntech
Trina climbed to a six-week high of $4.14, while Yingli, based in Baoding, China, rallied 31 percent last week to $2.34, the highest level since July 20. Suntech Power Holdings Co. (STP), the world’s largest manufacturer of solar panels, added 17 percent to $1.04, the biggest five-day rally in six weeks.

LDK Solar Co. advanced 26 percent for the week to $1.26, the highest price since Sept. 27. The solar company, which owes more than $3.1 billion, is seeking consent from bondholders to take on more debt. Xinyu, China-based LDK will offer investors 10 yuan ($1.60) for every 10,000 yuan they hold in its notes due 2014, according to a filing Dec. 14.

The Bloomberg China-US Equity Index climbed 1.4 percent to 95.82 on Dec. 14, extending its jump in the week to 2 percent. The Hang Seng China Enterprises Index (HSCEI) added 3.6 percent last week, and retreated 0.1 percent today to 11,294.11. The Shanghai Composite Index (SHCOMP) rose 4.3 percent on Dec. 14, the steepest one- day rally since October 2009, extending its increase last week to 4.3 percent. The measure is up 0.5 percent today to 2,160.34.

‘Turning the Corner’
Chinese stocks rallied on Dec. 14 after a preliminary reading for December on a purchasing managers index issued by HSBC Holdings Plc and Markit Economics indicated expansion in manufacturing for the second month. The data came after reports last week showed factory output and retail sales rose at the fastest pace since March.

“Anyone who’s looking at China’s numbers, even the PMI, will have to see that it’s definitely turning the corner,” Chris Bertelsen, chief investment officer of Global Finance Private Capital, which manages $1.7 billion in assets including emerging-market stocks, said by phone Dec. 14 from Sarasota, Florida. “This recovery will be durable and long lasting. China will be our leading investment in emerging markets in 2013.”

Youku, Sohu
Youku Tudou Inc. (YOKU) added 2.8 percent on Dec. 14 to $16.05 as Morgan Stanley rated the owner of China’s most-popular video websites the equivalent of buy in initial coverage. The Beijing- based company advanced 15 percent last week, the biggest increase in three months.

Sohu.com Inc. (SOHU), which owns the fifth-most-visited website in China, jumped 3.4 percent on Dec. 14 to $42.24, the highest level since Sept. 24. The company’s 12 percent rally for the week was the most in four months.

Beijing-based Sohu was removed the “Notorious Markets” list, the Office of the U.S. Trade Representative said in a Dec. 13 report. Sohu’s Sogou site reportedly made “notable efforts” to reduce inclusions of infringing content, the representative’s office said. Jiang Xin, a spokeswoman for Sohu, declined to comment on the report.