Kerry Logistics sets high aim for valuation in IPO
Several investment banks shortlisted as the firm aims to tap the mainland's consumption growth
Kerry Logistics Network, the logistics arm of Kerry Properties, aims to list in Hong Kong in the fourth quarter with a valuation that will top its peers already trading on the bourse.
Kerry Properties has shortlisted a handful of investment banks including Citigroup, BOC International and HSBC and will finalise the sponsors soon, according to people familiar with the situation.
Kerry Logistics could be worth much more than its peers in Hong Kong but it's too early to talk about its pricing or the size of its initial public offering now
Although Hong Kong is an international logistics hub only a few industry players are listed in the city. The valuations of those that are listed, including Sinotrans and ASR, range between six and 7.7 times earnings, much lower than that of international competitors.
FedEx, which is listed in New York, is priced at about 15 times its projected earnings while United Parcel Service is at 19 times.
"Kerry Logistics could be worth much more than its peers in Hong Kong but it's too early to talk about its pricing or the size of its initial public offering now," one of the people said.
The company's net profit, stripping out a paper gain from property revaluations, topped HK$815 million last year on HK$19.3 billion in sales. Earnings amounted to HK$1.07 billion if the one-off gain was included.