Sinotruk (Hong Kong), a mainland red-chip firm seeking to raise up to US$1.15 billion in Hong Kong, has priced its shares at a relatively expensive 15 to 20 times forward earnings, hoping to take advantage of strong market liquidity, according to market sources.
The Jinan-based truck manufacturer is selling 702 million new shares at HK$10 to HK$12.88 per share, in order to raise HK$7 billion to HK$9 billion, according to a sales document obtained by fund managers.
The offering has earmarked 90 per cent of the shares for institutional investors with the remaining to go into the public tranche. The international roadshow started yesterday and will close on Wednesday next week.
The public offering will take place from Thursday to next Tuesday. Trading is expected to start on November 28.
Sinotruk, together with its parent Sinotruk Group, is the largest heavy truck manufacturer in the mainland. Sinotruk accounted for more than 90 per cent of its parent's total sales of heavy trucks.
Sinotruk Group has about a 20 per cent market share of heavy truck sales in the country.
Its bigger rivals, Dongfeng Motor Group and FAW Group, mainly produce low-tonnage trucks, while Sinotruk dominates in the large-tonnage, heavy-duty truck sector.
