China’s US$4.3 billion IPO highlights investor confidence in world’s largest rail network
- The 30 billion yuan (US$4.3 billion) initial public offering for the Beijing – Shanghai High-Speed Railway line was oversubscribed 126 times
- In 2018, the 1,300km line reported an annual profit of 10.2 billion yuan (US$1.5 billion), making it one of the most profitable parts of China’s rail system
China’s first initial public offering allowing investors to buy shares in the world’s largest rail network proved hugely popular this week, with interest in the initial public offering for the Beijing – Shanghai High-Speed Railway line oversubscribed by 126 times.
According to exchange filings on Tuesday, the issuer was forced to offer some shares previously assigned for institutional investors to online bidders, although only 0.79 per cent of the bids from retail investors were successful.
The offering matches the 30 billion yuan raised by Postal Savings Bank of China last month, and a similar amount raised in 2015 by Guotai Junan Securities.
In 2018, the 1,300km line reported an annual profit of 10.2 billion yuan (US$1.5 billion) despite having only 67 employees, according to its prospectus, making it one of the most profitable parts of the system.