China National Building Material is set for a handsome start to its public offering with the float attracting billions of dollars in margin financing orders from local brokerages.
According to a South China Morning Post poll of five brokerages, margin orders for the mainland building material producer have exceeded $4.2 billion - 23.46 times the retail tranche of the international offer.
The improved sentiment in the equity market and the track record of the sponsor have helped boost the response to the offer despite some investor concerns over the company's high gearing.
The strong demand came as no surprise to brokers who have already seen investors reserving cash from Golden Eagle Retail Group's offering last week.
Market sources said Golden Eagle's retail tranche, which closed yesterday, was about 300 times oversubscribed, soaking up about $42 billion in cash.
Golden Eagle is likely to price its international offering near the top of the indicative price range between $2.50 and $3.15, sources said.