China Railway soars on HK debut
Smash debut: Shi Dahua, chairman of China Railway Group Ltd celebrates during the listing ceremony of the group's IPO at Hong Kong Stocks Exchange. Picture: EPA
Saturday, December 8, 2007
CHINA Railway Group shares jumped as much as 30 per cent on their Hong Kong debut yesterday, beating forecasts, after the third-largest construction contractor in the world raised US$5.5 billion in a Hong Kong and Shanghai IPO.
The performance bucks a recent rocky trend for Hong Kong IPOs as investors see China Railway as a proxy for the country's railway investment boom as Beijing plans massive spending to help ease bottlenecks triggered by robust economic growth.
But some market players said the strong debut was due in part to support from China's new sovereign wealth fund.
"China Railway is a unique case. As China Investment Corp bought a stake in it, it should perform better than some of the recent laggards," said Y K Chan, a strategist at Phillip Capital Management.
China Investment Corp bought US$100 million worth of shares in China Railway's offering, while other investors include the Government of Singapore Investment Corp (GIC) and China Life Insurance's parent.
Shares in China's largest construction company, which builds railways, highways, ports and other big-ticket projects, rose as high as HK$7.50, up from an IPO price of HK$5.78.
Reuters
The performance bucks a recent rocky trend for Hong Kong IPOs as investors see China Railway as a proxy for the country's railway investment boom as Beijing plans massive spending to help ease bottlenecks triggered by robust economic growth.
But some market players said the strong debut was due in part to support from China's new sovereign wealth fund.
"China Railway is a unique case. As China Investment Corp bought a stake in it, it should perform better than some of the recent laggards," said Y K Chan, a strategist at Phillip Capital Management.
China Investment Corp bought US$100 million worth of shares in China Railway's offering, while other investors include the Government of Singapore Investment Corp (GIC) and China Life Insurance's parent.
Shares in China's largest construction company, which builds railways, highways, ports and other big-ticket projects, rose as high as HK$7.50, up from an IPO price of HK$5.78.
Reuters
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