Merchants Securities heads for weakest debut

Merchants Securities rose 8.4 percent to 33.61 yuan in Shanghai, from its initial public offering price of 31 yuan, after earlier climbing as much as 15 percent. The average first- day gain for companies that started trading in China this year is 81 percent, according to data compiled by Bloomberg.

China's benchmark Shanghai Composite Index has declined 5.4 percent from an Aug. 4 high on concern that economic stimulus measures will be phased out, curbing expansion in the world's third-largest economy. Smaller rival Everbright Securities Co. rallied 30 percent on its Aug. 18 trading debut.

“The market isn't as heated as it was when Everbright went public,” said Jiang Yan, a Beijing-based analyst at Bohai Securities Co. “Investors are not pushing up new stocks as they used to do” when China lifted a moratorium on IPOs in June.

Merchants Securities raised 11.1 billion yuan ($1.6 billion) selling shares to institutional and retail investors in the 69th priced IPO in China since the country lifted the moratorium on first-time stock sales.

All the companies that went public in China this year are trading above their IPO price, according to Bloomberg data. Metallurgical Corp. of China Ltd. has been the worst performer, climbing 5.4 percent since its Sept. 21 debut.

Domestic companies have raised 153 billion yuan this year from share sales, excluding rights offers and equity-linked securities. That has surpassed the amount for all of 2008, when the Shanghai Composite fell a record 65 percent.

Investors opened about 860,000 investment accounts in October, down from 2.17 million in August, according to China Clear, the country's biggest clearing house.

Subscribe to The China Post and save 25%. Click here

SharePrintEmail

Write a Comment

Terms

Enter your comments - 3000 characters max

Type in image code

Submit

 Receive China Post promos
 Respond to this email