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Agricultural Bank Of China Places High Hopes On IPO Outcome
By: Louis Kent Lee
Articles (199) Profile

Agricultural Bank of China (ABC) has expressed yesterday that it is confident about its behemoth IPO launch outcome in an interview with the media after its presentation to its investors. ABC seeks to raise about US$23 billion by listing in Shanghai and Hong Kong and it’s deemed as the world’s biggest IPO yet. ABC has over 24,000 branches and more than 441,000 staff.

Held at the Fullerton Hotel, investors are seated in a ballroom where a presentation of the prospectus was presented behind closed doors. It is believed that about 150 fund managers and institutional investors turned up for the prospectus presentation. Singapore is ABC’s last stop for its IPO roadshow. ABC has earlier held road shows for its IPO in Hong Kong, New York and London.

ABC’s plan of seeking dual listing in Hong Kong and China seems to be in place despite the market conditions that are counter acting some of investors’ interest. Notably, Temasek Holdings and United Overseas Bank have invested US$200 million and US$100 million respectively. It is known that $5.45 billion of the Hong Kong IPO has been taken up by cornerstone investors, leaving only a small chunk to other investors.

Executive vice-president Pan Gong Sheng expressed that ABC is confident that the IPO outcome will be a successful one despite the market volatility and conditions, especially in the Chinese stock markets and cited it was only natural for ABC to experience that and is not too worried about it. His confidence in ABC’s IPO outcome stemmed further when he added that investors worldwide have expressed positive interest during their road shows.

ABC is projecting growth returns of up to 30 percent over the next 3 years. It will sell 24.8 billion Hong Kong listed H shares at its set range of HK$2.88 – HK$3.48 and 22.2 billion A shares in Shanghai ranging between 2.52 yuan to 2.68 yuan.

According to Bloomberg, the final price for the Hong Kong IPO will be priced on July 7. The listing date for its Shanghai IPO will be on July 15 and Hong Kong the following day.

Louis is a qualified accountant with the ACCA, and is the Research Editor at Shares Investment magazine.

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