China on the path to a new record. With the IPO securities Agricultural Bank of China (ABC) in Hong Kong and Shanghai, the country is about to pick up the world's largest IPO by both the number and value. China will take the leading position currently held by the United States. The consultancy firm PricewaterhouseCoopers (PwC) estimates that the total number of introductions for the two exchanges in the country could rise to 300 in 2010, against 99 last year. Chinese companies could raise 500 billion yuan (about 59 billion euros) through its operations.
Despite a difficult market environment, the Chinese have taken significant introductions in the first half of 2010."It shows that Chinese companies are doing well, thanks to the continued growth of the national economy, and become more mature," said Frank Lyn, China market responsible for PwC.
Already 176 IPOs
In the first half, Chinese companies entered the markets have raised 212.7 billion yuan (26.6 billion euros) in 176 IPOs. It's more for the full year 2009, where introductions were about 187.9 billion yuan (21.9 billion euros). This optimism is due to the abolition in June 2009, the freeze imposed since September 2008 IPOs in global financial crisis, the Chinese stock market regulator.
Last big operation to date, the Agricultural Bank of China (ABC), the last of the four major state banks not yet rated.The final IPO price should be set on July 7 and will begin trading in Shanghai on July 15 and July 16 in Hong Kong. But already the observers believe it will be the biggest operation of placing on the market. ABC gives indeed a goal of raising $ 23.2 billion. An amount that exceeds the record set by another Chinese bank, Industrial and Commercial Bank of China (ICBC) IPO in 2006 and had raised 22 billion dollars.
Record seen
ABC looks set to beat that record. Eleven major investors, including sovereign funds of Kuwait, Qatar and Singapore, the British bank Standard Chartered and Hong Kong tycoon Li Ka-Shing, have already committed to invest over 5 billion dollars in the Chinese bank.
Traders were cautious after the lower price ranges announced.On Monday, the third Chinese bank had said it would sell its shares listed in Shanghai at a price of between 2.52 and 2.68 yuan (0.30 to 0.32 euro) against the range of 2.88 3.48 HK dollars (0.30 to 0.36 euro) for those listed in Hong Kong. But investors were to rendezvous. Last Thursday, the day after the opening of subscriptions for institutional, ABC has received requests totaling approximately $ 50 billion for its introduction alone Hong Kong.
After the marketing of ABC, China does not stop there. The government now plans to allow foreign companies to be listed in Shanghai, which was impossible until now.
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