Three companies have applied to the China Securities Regulatory Commission (CSRC) for permission to sell Shenzhen B shares. Sources said the applications were made by Hubei Sanonda Co, Shandong Shouguang Paper Manufacturing and Nanjing Posts and Telecommunications Co. All are among the 33 companies picked by Beijing for the latest round of B-share offers and listings. Promotion for the offers could start as early as the middle of this month if the vetting process went smoothly, the sources said. In the first quarter, only one B-share offer was made, by Dalian-based Wafangdian Bearing Co, although a number of companies trying to capitalise on China's burgeoning economic recovery are queuing for similar listings. Among the three companies, Hubei Sanonda has A shares trading on the Shenzhen stock exchange. China's biggest pesticide maker, Hubei Sanonda had planned to issue 100 million foreign currency B shares, representing about 36 per cent of the company's enlarged share capital. Both Nanjing Posts and Shandong Shouguang Paper also applied to issue 100 million B shares. Hubei Sanonda processes farm chemicals, including pesticides and herbicides, with an annual capacity of about 20,000 tonnes. The company aims to use the B-share proceeds to expand its production capacity, increase market share and develop higher-margin products. J & A Securities has been named as the domestic lead underwriter, while W I Carr Indosuez Capital Asia has been named the international co-ordinator. Hubei Sanonda, which accounts for about 5.4 per cent of the mainland market, estimated net profit to jump sharply to more than 70 million yuan (about HK$65.31 million) for last year, against more than 40 million yuan in 1995. Sales also rose to more than 700 million yuan last year from more than 600 million yuan in 1995, boosted by rising demand for farm chemicals. Farmers have shown a higher willingness to use chemicals to increase agricultural outputs. Analysts said this year's B-share issues could command a multiple of about 'six to eight times' given the notable changes in the country's economic fundamentals. Wafangdian was selling its B shares at 6.85 times its earnings for last year.