Banking

ABC to begin road show

By Hu Yang (chinadaily.com.cn)
Updated: 2010-06-10 16:07

Agricultural Bank of China (ABC) plans to hold its road show in Beijing, Shanghai and Shenzhen to promote its shares to A-share institution investors, starting June 17.

Related readings:  Agricultural Bank gets CSRC nod for Shanghai, HK floats  Agricultural Bank of China's IPO plan approved  Securities regulator reviews ABC's IPO plan  ABC advised to postpone listing plan

Authorities gave approval Wednesday to launch an initial public offering in Shanghai and Hong Kong, the 21st Century Business Herald reported.

A person close to the bank's underwriter said that ABC has previously contacted potential institutional investors and that many large-scale fund companies have already shown interest in buying shares.

Speculation on the share price is stirred by weak market sentiment. A staff member of ABC denied a rumor that the lowest offer price will be 1.905 yuan. The number is calculated by multiplying ABC's 2009 net asset per share by a price-to-book ratio of 1.5.

But an analyst said setting an offer price is much more complicated than the above formula.

ABC plans to sell up to 22.24 billion A-shares on the Shanghai Stock Exchange and up to 25.41 billion shares in Hong Kong, excluding an over-allotment option. The IPO could possibly be the world's largest ever, surpassing a previous record of $21.9 billion set by Industrial & Commercial Bank of China in 2006.