A fresh round of fund-raising exercises among second-line stocks is expected as market sentiment improves and banks tighten their lending policies, according to analysts. The forecast comes after three companies announced plans to raise total net proceeds of up to HK$476 million. Xinao Gas Holdings plans to raise up to HK$370 million, while U-Right International has set a target of HK$80 million. Tomorrow International Holdings hopes to raise HK$26 million. However, shares in the three fell more than 12 per cent yesterday after the announcements. Kenny Tang Sing-hing, associate director of Tung Tai Securities, said it was possible more second- and third-line firms would take to fund-raising amid an improvement in market sentiment. 'Banks' lending policies are also more stringent on second-line companies compared with big conglomerates,' Mr Tang said. However, he said the share prices of the three companies fell due to investor concerns that the fund-raising exercises might dry up the market just as it was beginning to recover. Casual-wear manufacturer U-Right agreed to place 120 million existing shares at 69 HK cents each. The stock dropped 13.89 per cent to close at 62 HK cents, with HK$149.2 million worth of shares changing hands. Shares of consumer electronics firm Tomorrow International fell 12.14 per cent to 15.2 HK cents after it agreed to place 178 million shares at 15 HK cents each. Investors responded to a placement of 110 million new shares from Xinao Gas by driving its price down 12.59 per cent to HK$2.92.