Keen interest expected in 20b yuan Shanghai listing despite costing more than Hong Kong flotation
The Bank of China set the price range of its mainland initial public offering at between 3.05 yuan and 3.15 yuan per share yesterday, slightly higher than its Hong Kong offer price but at a 9 per cent to 12 per cent discount on yesterday's closing price of the H share.
Analysts said they expected keen interest in the 20 billion yuan Shanghai listing.
They predicted the bank's A shares would be priced at the top end of the range and rise to at least the same level as its H shares on its debut on July 5.
At the top of its range, BOC would be priced at 2.18 times this year's book value.
'They need to price at a discount to the market to ensure this large bulk of shares will be absorbed,' Macquarie Securities head of China research Peter So said. 'But they also realise they can price higher than in Hong Kong because of the pent-up demand.'