Stocks News
- Ping An raises US$5b in Shanghai IPO
Date: 15-Feb-2007 Sources: (Shenzhen Daily)
PING An Insurance (Group) raised 38.9 billion yuan (US$5 billion) in the second-largest initial public offering (IPO) on the domestic stock markets.
The Shenzhen-based insurer sold 1.15 billion new A shares, or 15.66 percent of its expanded share capital, in Shanghai, the company said yesterday.
The offer was priced at the top of an indicative range of 31.80 to 33.80 yuan per share, drawing a total of 1.09 trillion yuan in subscriptions from institutional and retail investors.
That amount was second only to the 1.16 trillion yuan attracted by Industrial Bank during its Shanghai IPO in January, which set a record for a domestic share offer.
The pricing valued Ping An after the IPO at 76 times 2005 earnings excluding extraordinary items, under Chinese accounting standards.
But because of the firm's strong growth prospects and the scarcity of listed Chinese insurance stocks - Ping An will be only the second - analysts predict the shares will hit at least 40 yuan on their Shanghai listing day, expected to be March 1. Some think the shares may climb near 50 yuan.
Ping An's Hong Kong-listed H shares closed at a premium of 13 percent to the A shares' IPO price Tuesday. That gap is likely to be erased quickly, since the A shares of many dual-listed mainland financial stocks trade at premiums of 20 percent or more to their H shares.
Ping An allocated 30 percent of its IPO to strategic investors, 20 percent to institutions and the rest to retail investors.
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