Chinalco Mining tumbles 6.3pc on trading debut
Market newcomer closes 6.3pc lower than issue price after negative report about steel mills
Shares in Chinalco Mining Corp International, which is developing a copper mine in Peru, closed 6.3 per cent lower than their offered price on their trading debut yesterday.
The sharp price fall might have been caused by retail investors, who tended to have a short investment horizon and were not familiar with the company's operations and outlook, analysts said.
Chinalco Mining is the overseas non-aluminium and non-ferrous metals arm of state-owned Aluminum Corp of China (Chinalco).
"Chinalco Mining's operation in Peru is a long way from Hong Kong and production will only begin late this year, so it's not easy for local investors to picture its prospects," said Christfund Securities research director Simon Lam Ka-hang.
Its shares traded as much as 11.4 per cent below the initial public offering price of HK$1.75 and a high of HK$1.67 before closing at HK$1.64.
Retail investor sentiment for metals stocks was probably also dampened by comments from the China Iron & Steel Association yesterday that profit at the nation's large steel mills slumped by 98 per cent last year.