The strong IPO performance of China Railway Group shares, which jumped 69% per cent on their first trading day in Shanghai on Monday, allayed fears about an imminent collapse in this year’s $90bn boom in Chinese company listings. The debut of state-owned China Railway, one of the world’s largest construction contractors, was seen as a key barometer of investor sentiment after lacklustre listings of two Chinese companies in Hong Kong over the past fortnight. Shares in the group, which raised $3bn, rose from an offer price of Rmb4.8 to nearly Rmb8.09, within the range of analysts’ forecasts. The first-day bounce was well below several other recent mainland flotations but showed that Chinese investors still want to buy shares in well-known companies. It came despite an 18.2% decline in the Shanghai Composite Index in November, the biggest monthly drop over a decade.

This entry was posted by Gwen Robinson on Tuesday, December 4th, 2007 at 5:11 and is filed under Capital markets. Tagged with China Railway. Edit this entry.