China to see steady IPO flow in 2011
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China Hainan Rubber Industry priced its Shanghai IPO at the top end of an indicative range, raising US$709 million in what could be a harbinger of a steady deal flow next year in China, the world's top market for initial public offerings.
Global IPOs have hit a record this year with companies expected to have raised more than US$300 billion in IPO proceeds, according to corporate advisory firm Ernst & Young.
China issuers made up more than 46 percent of global IPOs in terms of the proceeds, raising US$117.9 billion in 442 deals for the first 11 months of 2010, said Ernst & Young.
Hainan Rubber, a leading Chinese rubber producer based in the southern island province of Hainan, set the offer price for its IPO at 5.99 yuan (90 US cents) a share, the company said in a statement yesterday.
Companies of modest size such as Hainan Rubber are expected to make up the majority of new IPOs coming to the market in 2011, said Zhang Ying, an analyst with Industrial Securities in Shanghai.
Wind turbine producer Sinovel Wind said it had started premarketing for its Shanghai IPO, which could raise as much as US$519 million, and said it would price the IPO by January 7.
Though many cash-hungry companies - especially insurers, regional banks and securities firms - are expected to tap the stock market for capital, it's uncertain how soon these IPOs will materialize, analysts said.
New China Life and the People's Insurance Company of China, the country's top non-life insurer, are likely to go for an IPO next year.
