Top Biz News

IPO sparks investor buzz

By Zhang Jin in Hong Kong and Pan Zhongming in Shenzhen (China Daily)
Updated: 2006-09-05 08:50

China Merchants Bank (CMB), the mainland's sixth-largest lender, is expected to draw heavy subscription to its Hong Kong initial public offering (IPO) due to a smart pricing strategy, decent asset portfolio and strong demand for new shares, analysts said.

Customers use ATMs at a China Merchants Bank branch in Beijing on August 8.

Anticipated demand for the IPO would further consolidate overseas investor confidence in the mainland financial sector, they said.

The bank launched its promotional roadshow yesterday to market the shares to institutional investors. The offering may raise as much as US$2.4 billion, excluding an over-allotment option that allows the bank to float more shares if its IPO is heavily subscribed.

"Institutional investors have shown great interest in CMB," said an analyst in Shenzhen, where the bank is based. He declined to be named as his securities house is involved in the deal.

"Cash will flow in as soon as the bank opens its order book," said the analyst.