China Shipbuilding Industry Co. completed the second-smallest debut gain in Shanghai trading this year
17.12.2009 (11:38)
China Shipbuilding Industry Co. completed the second-smallest debut gain in Shanghai trading this year as demand for new shares eases following about 80 equity offerings since June.The country’s biggest maker of vessel equipment rose 12 percent to 8.30 yuan at the close, compared with an IPO price of 7.38 yuan. The company raised 14.7 billion yuan ($2.2 billion) in the share sale, which valued it at about 42 times 2008 earnings, higher than the benchmark Shanghai Composite Index.
Chinese companies have risen an average of 82 percent on trading debuts this year before today, as a state stimulus package spurs economic growth. At least $24.8 billion has been raised in priced mainland initial public offerings this year, accounting for more than a quarter of the global tally, according to data compiled by Bloomberg.
“The main reason for the weak IPO performance is that the shares were sold for a high price,” said Zhao Zifeng, who helps oversee about $10.2 billion at China International Fund Management Co. in Shanghai. “If IPO shares are offered at high price-to-earnings ratios, gains between the primary and secondary markets will be squeezed further.”
www.bloomberg.com
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