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Everbright Securities to raise up to US$1.6b in IPO
By Winny Wang |
August 3, 2009, Monday
|
Online Edition
Online Edition
EVERBRIGHT Securities Co plans to collect as much as 10.96 billion yuan (US$1.6 billion) in the first initial public offering by a Chinese brokerage since the end of 2002.
It will sell up to 520 million shares, which accounts for 15.21 percent of its expanded capital, at between 19 yuan to 21.08 yuan each, the country's 11th biggest brokerage by assets said in a statement yesterday.
The price-earnings ratio will be 52.78 to 58.56 times its 2008 earnings based on the enlarged share capital, it said.
"The IPO will be a key step for Everbright Securities to narrow its gap with leading brokerages in China," said Deng Shubin, an analyst at Central China Securities Research Institute.
Deng estimated that a reasonable price for the brokerage is between 15 yuan and 20 yuan, and its net income would reach 2.5 billion yuan to 2.8 billion yuan this year.
Everbright Securities' profit dropped 71 percent in 2008 to 1.37 billion yuan as a stock market rout curbed trading. The firm's profit increased 20 percent in the first half of this year on a yearly basis.
The brokerage will launch an online tranche tomorrow to sell 70 percent, or 364 million shares, of the new offer to institutional and retail investors.
It will use proceeds from the sale to replenish working capital. It also plans to increase the number of its outlets to more than 120 through mergers and acquisitions and by opening new ones, Everbright said in its prospectus.
Citic Securities was the last brokerage that launched an IPO on the Chinese mainland. It raised 1.76 billion yuan in December 2002.
It will sell up to 520 million shares, which accounts for 15.21 percent of its expanded capital, at between 19 yuan to 21.08 yuan each, the country's 11th biggest brokerage by assets said in a statement yesterday.
The price-earnings ratio will be 52.78 to 58.56 times its 2008 earnings based on the enlarged share capital, it said.
"The IPO will be a key step for Everbright Securities to narrow its gap with leading brokerages in China," said Deng Shubin, an analyst at Central China Securities Research Institute.
Deng estimated that a reasonable price for the brokerage is between 15 yuan and 20 yuan, and its net income would reach 2.5 billion yuan to 2.8 billion yuan this year.
Everbright Securities' profit dropped 71 percent in 2008 to 1.37 billion yuan as a stock market rout curbed trading. The firm's profit increased 20 percent in the first half of this year on a yearly basis.
The brokerage will launch an online tranche tomorrow to sell 70 percent, or 364 million shares, of the new offer to institutional and retail investors.
It will use proceeds from the sale to replenish working capital. It also plans to increase the number of its outlets to more than 120 through mergers and acquisitions and by opening new ones, Everbright said in its prospectus.
Citic Securities was the last brokerage that launched an IPO on the Chinese mainland. It raised 1.76 billion yuan in December 2002.
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