Yangzijiang advances 7pc daily limit on debut
Yangzijiang Shipbuilding Holdings, one of the mainland's top three private shipyards and the first mainland company to list in Taipei using Taiwan depositary receipts, made its trading debut with flying colours.
The company rose the maximum 7 per cent daily trading limit allowable with TDRs, before a mandatory suspension was triggered on the Taiwan Stock Exchange.
Yangzijiang Shipbuilding, which has been listed on the Singapore Exchange since 2007, offered 240 million TDRs at NT$18.80 (HK$4.57) each yesterday. The TDRs rose to NT$20.10 before the suspension was triggered.
The company, which is well placed to benefit from the increasingly close economic relationship between Taipei and Beijing, reportedly had some 220 million TDR orders in the pipeline when it was suspended.
The company has said the NT$4.56 billion proceeds from the TDR issue could help it acquire mainland counterparts because the industry needed consolidation to improve profitability and competitiveness.
About 150 mainland shipyards lost money in the year to May, up from 90 three years earlier, according to a Nomura report.
Yangzijiang Shipbuilding has benefited from a recovery in the global shipbuilding industry this year, which has seen a substantial rise in new vessel orders as shipowners in Greece and Japan resume buying.
Yangzijiang Shipbuilding won US$234.2 million worth of new building contracts for 10 vessels in the second quarter, lifting the number of new contracts to 17 vessels for a total contract value of US$430.7 million for the first half.
The yard posted a 24 per cent year-on-year increase in net profit to 1.39 billion yuan (HK$1.59 billion) in the first half, with sales up 100 per cent.