Firms' stocks surge on HK debut

By Jonathan Yeung (China Daily)
Updated: 2006-12-09 09:30

Mainland companies' shares surged on their Hong Kong trading debut on Friday, thanks largely to local investors' increasing demand for mainland listings.

Shares of China Telecom's spin-off China Communications Services saw the greatest rise, reaching a peak of HK$4.22 (54 US cents) before falling to HK$4.08 (52 US cents), up 85.5 percent from the company's initial public offering (IPO) price of HK$2.2 (28 US cents), making it the best newcomer of the year so far.

Zhaojin Mining Industry, which raised around US$281 million, finished its first day of trading with its shares advancing to HK$15.98 (US$2), up 26 percent on its IPO price.

The gold producer, based in East China's Shandong Province, saw its shares trading between HK$16.64 (US$2.13) and HK$15.42 (US$1.97) on Friday, increases of 31 percent and 22 percent from its IPO price.

Chinese bathroom appliances manufacturer Aupu Group gained 32.5 percent on Friday, ending the day at HK$1.63 (21 US cents).

The three outperformed the broad market, which witnessed a 0.55 percent dip in the benchmark Hang Seng Index.

Fulbright Securities General Manager Francis Lun described the growth of the three companies' shares as "stellar but natural to understand."

"Local investors' interest in mainland companies listed in Hong Kong remains very strong," Lun said, "The recent appreciation of the yuan also makes mainland companies' shares more attractive."

Encouraged by the Industrial and Commercial Bank of China's record-breaking US$21.9 billion listing in October, investors have been scrambling for mainland companies' IPOs this year.

The H-share index of mainland firms listed in Hong Kong has soared 65 percent since the beginning of this year.

(For more biz stories, please visit Industry Updates)

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