Sinoma cements HK offering
Updated: 2007-12-07 09:44
The mainland's largest cement equipment maker China National Materials (Sinoma) said yesterday it would attempt to boost its earnings with greater expansion overseas.
"The overseas and domestic markets currently weight about 65 percent and 35 percent for our cement business, respectively. The former will continue to enlarge with our foray into Russia, North America and Africa," the company's chairman and executive director Tan Zhongming told reporters at its IPO press conference in Hong Kong yesterday.
Tan said the company intends to merge with the cement arm of its parent group. The parent group has signaled giving preferences to support the company going public in Hong Kong.
Sinoma will issue 930 million shares in the Hong Kong exchange in a bid to collect as much as HK$4.1 billion through the deal.
|
|||
"Investment in the industry was overheated in the past, so the measures could help stabilize the market," Tan said.
As for its glass fiber business, he predicted the annual production capacity would increase to 400,000 tons in 2008 from 230,000 tons in 2006. That segment contributed 19 percent of revenue in the first six months this year.
Tan said the company had earmarked 5.1 billion yuan as capital expenditure in 2008, enough to bankroll the firm's future expansion.
Among the IPO proceeds, 75 percent will be set aside for investing in glass fiber, cement and hi-tech materials, while 15 percent and 10 percent will be used for reimbursing short-term loans and operating capital.
Sinoma will open its order book for retail investors today and the shares are expected to start trading on Monday.
Sinoma is the largest mainland cement equipment provider with 90 percent market share. The company netted HK$168 million profit for the first six months this year.
The listing document projected the company would reap no less than 422 million yuan in net profit for the whole year, representing a 50 percent growth verses 282 million yuan the previous year.
Ricky Cheung, vice-president of Enlighten Securities and Futures, expected hot response.
"The IPO market sentiment is recovering. Coupled with the Beijing Olympics driving a strong demand for cement, the shares are predicted to shoot up by 10 to 20 percent in the first trading day," he said.
|
|