Tianneng Power International, a mainland manufacturer of lead-acid motive batteries, aims to raise up to HK$531 million through an initial public offering in Hong Kong and plans to sell shares at a cheaper valuation than its industry peers.
The battery maker planned to sell 300 million new shares at between HK$1.33 and HK$1.77 each, representing nine to 12 times its earnings per share for last year, market sources said.
Scud Group, a mainland telephone battery maker, trades at 12 times last year's earnings, while another mainland battery producer, Coslight Technology International Group, trades at 17 times.
Tianneng plans to begin taking share orders from international investors from May 11. It intends to market the offering in Hong Kong, Singapore, Taiwan and Europe in a 14-day roadshow.
Hong Kong-based investment bank Kingsway Capital is the deal's sole arranger.
Zhejiang-based Tianneng operates five factories in three adjacent provinces, where it manufactures batteries for lightweight transport, such as electric bicycles, motorcycles and cars.