SHANGRI-LA Asia's first day of trading on the stock exchange got off to a rousing start yesterday as the shares closed at $6.10, up 24.4 per cent from the offer price of $4.90.
Brokers said the increase was not surprising because the stock price increase boosted Shangri-la Asia's price-earnings multiple to 15 times, in line with other hotel stocks.
Many investors capitalised on the sharp jump as Shangri-La Asia was the most heavily traded stock, with turnover of $325.4 million.
Volume was 53.6 million shares with a trading range of $5.90 to $6.20.
The $735 million flotation of Shangri-La Asia, the Hongkong and China hotel arm of the Shangri-La group, was oversubscribed by 108 times.
The company will use part of the net proceeds of $697 million to reduce debt by $280 million to $1.8 billion.
