China Life shares double on debut
By Hu Yuanyuan (China Daily)Updated: 2007-01-10 09:20
Shanghai debut yesterday, showing massive investor interest in the first insurance stock listed on the domestic market.
China Life's A shares opened at 37 yuan, 96 percent higher than their initial public offering price of 18.88 yuan, beating most analysts' expectations, which were around 30 yuan.
"We are encouraged by such a high opening price but also feel even more pressure, as we will have to strive to meet investors' expectations," Wu Yan, president of China Life, told China Daily, adding that the opening price was appropriate given the firm's potential for growth.
China Life raised 28.3 billion yuan by selling 1.5 billion shares on the Shanghai bourse last month, making it the largest IPO in the world's life insurance sector. It also reached a record high by attracting over 810 billion yuan in subscriptions from retail and institutional investors.
"The main reason for listing in Shanghai is to bring benefits to domestic investors and share our growth with them," said China Life's Chairman Yang Chao.
After a spectacular opening, the company's shares continued soaring with heavy trade, hitting a high of 40.2 yuan before closing up 106 percent at 38.93 yuan. That's 52 percent more than the HK$25.60 close of its H shares, which dropped 4.7 percent yesterday.
"The fall of China Life's H shares shows that some investors are worried that the insurer's stocks may have been overvalued," said an analyst with CTITC Securities.
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