Erdos Cashmere B listing to reap up to US$53.79m

INNER Mongolia-based Erdos Cashmere Products is raising up to US$53.79 million in its B-share offering on the Shanghai stock exchange, the company says.

One analyst said the offer would be at a price-earnings multiple of between 6.5 times and 7.5 times on 1995 projected earnings of 182.8 million yuan (about HK$166.71 million). Erdos said the shares would be sold at 61.3 US cents if the PE ratio was 9.4 times.

Based on the current PE range, the stocks will be offered at between 42.4 cents and 48.9 cents a share, with the company raising between US$46.64 million and US$53.79 million.

Erdos is offering 110 million B shares, or 32.7 per cent of its enlarged share capital, for its Shanghai listing.

An underwriting agreement is expected to be struck this week with Crosby Securities and China Southern Securities.

Crosby Securities said recently Erdos was the world's largest cashmere company. China produces 60 per cent of the world's cashmere, and Erdos purchases 25 per cent of China's annual output.