| CCB president defends IPO price against "too low" claims |
| Monday,July 17,2006 Posted: 07:51 BJT(2351 GMT) Xinhua |
BEIJING, July 15 -- The president of the China Construction Bank (CCB) has defended the company's share price at its initial public offering (IPO) against claims that it was undervalued. Guo Shuqing told a forum on public management here on Saturday that the ratio of the CCB's IPO share price and net asset per share is 1.96, almost the same as the international average ratio of most modern banks. After the IPO, its share price remained almost unchanged for half a month, and one day it even fell below the IPO price, said Guo. The CCB, one of China's "big four" commercial banks, was listed on Hong Kong Stock Exchanges (HKSE) last October, raising eight billion U.S. dollars in its IPO, the world's largest fund collection since 2001 and a record for the HKSE. The stock's IPO price was 2.35 Hong Kong dollars, but on May 8 this year, the CCB's share price in Hong Kong rose by 50 percent, which was regarded by some investors as evidence its IPO price had been set too low. However, Guo described the jump as reasonable because the same day the total H-share index rose 53 percent. "Investors' confidence in China's economic prospects and the Renminbi's appreciation potential together boosted the share price," he said. |
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