China Coal Energy, the mainland's second-largest coal miner, is likely to price the shares at the high end of the indicative range for its initial public offering, thanks to heavy subscription from institutional and retail investors, robust appetite for new issues and strong market momentum, sources said. A source said that retail investors had placed orders for 150 times the China Coal shares available to them while the international portion was said to be well covered. The coal miner is selling 3.24 billion H shares at between HK$3.20 and HK$4.05 each to raise as much as HK$1.31 billion from its first overseas share sale. The offering represents a valuation of 11.5 times to 14.6 times this year's forecast earnings, higher than Hong Kong-listed peers Shenhua Energy's 13.7 times and Yanzhou Coal's 10 times. 'It is a bit expensive if the firm fixed the offering at the high end despite most worldwide competitors trading at a similar valuation,' said a fund manager at a Japanese asset management company. He cited Shenhua Energy as being the preferable company given its larger size and higher growth potential. 'Subscription levels have been good and the maximum 20 per cent clawback is likely to be triggered,' said the source. According to China Coal's prospectus, the shares available for the retail offering will be increased to 650 million shares from 162.5 million shares initially. China International Capital Corp, Citigroup and Morgan Stanley are arranging the share sale. Trading is set to begin on December 22. Underscoring the demand for new mainland companies, China Communications Construction shares, which formally begin trading on Friday, are being ordered in the grey market for as much as HK$9 each, about 95 per cent higher than the offer price of HK$4.6.