Investors flock to first new listing
9 June 2006
The Shanghai Composite Index closed 0.12% up Thursday, buoyed by investor interest in the mainland's first initial public offering following the lifting of a year-long ban. Lead underwriter Guosen Securities said CAMC, a small international engineering contractor, was 576 times oversubscribed as 1.14 million retail investors put up US$25.45 billion for the 60 million shares on offer. In all, 48 million shares will go to retail investors and 12 million to institutional investors, whose portion was more than 100 times oversubscribed. The company aims to raise about US$55.39 million selling the shares at US$0.92 each. Guangda Securities analyst Zhu Haibin told the South China Morning Post that Wednesday's 5.33% fall in the index was due in part to the large sum frozen for the application to buy CAMC and that this money could enter the market today. Meanwhile, Hong Kong stocks tumbled to a three-month low Thursday as fears over rising global interest rates drew money out of Asia and back to the US.