China Life, the country's No. 1 life insurer, saw its share price soar
Tuesday in its widely anticipated debut on the Shanghai Stock Exchange, an IPO
that raised nearly 28 billion yuan (US$3.6 billion; euro2.8 billion).
China Life's shares opened trading at 37 yuan (US$4.74; euro3.64), up from
the company's initial public offering price of 18.88 yuan (US$2.42; euro1.86).
Its shares closed at 38.93 yuan (US$5.00; euro3.84).
The insurer's better-than-expected debut helped lift the benchmark Shanghai
Composite Index to a record high close of 2,807.80, up 3.7 percent from Monday.
China Life already has shares traded in New York and Hong Kong.
In contrast to Shanghai, in Hong Kong the life insurer's shares fell 4.28
percent to 25.70 Hong Kong dollars (US$3.29; euro2.53) by midafternoon, amid
heavy selling of mainland-based heavyweights.
Analysts consider the life insurer to be overvalued, and investors are
expected to sell to lock in profits following the market's surge to record highs
in recent weeks.
"The price in Shanghai market is a little bit too high and I don't think it
accurately reflects the company's real situation," said Zhu Haibin, an analyst
with Everbright Securities in Shanghai.
Chinese officials are trying to build up the country's stock markets by
encouraging bigger companies to list shares domestically following a wave of
overseas IPOs that have raised billions of dollars.
China Life has benefited from strong growth prospects and the relative
scarcity of insurance stocks on mainland exchanges, as well as an overall buying
fervor that intensified late last year.