Agile Property Holdings Ltd., a developer in the Pearl River Delta region of South China, aims to raise as much as US$404 million in a Hong Kong listing next month, sources familiar with the deal said.

Agile, which is offering about 955.1 million shares, or 28 percent of its enlarged share capital, will close its order book Dec. 8 and aims to float its shares on the Hong Kong stock exchange Dec. 15, according to a company listing document.

The company started a management roadshow Friday and has set a proposed IPO price range of HK$2.80 (US$0.36) to HK$3.30, representing a 28 to 37 discount to its book value, or 10.4 to 12.2 times forecast 2005 earnings per share of HK$0.27.

Morgan Stanley is the underwriter of the offering.

On average, mainland property players including Beijing Capital Land (HK: 2868), China Resources Land (HK: 1109), China Overseas Land (HK: 0688) and Vanke (SZA: 000002; SZB: 200002) trade at a 28 percent discount to their book values and 12 times 2005 earnings, according to Morgan Stanley.

“Agile is a well-known brand name here, and the property sector is red hot. But it all depends on pricing,” said Sam Ho, an assistant fund manager at KDB Asia.

Guangzhou R&F Properties Co. (HK: 2777), which raised US$294 million in a July listing arranged by Morgan Stanley and CSFB, has seen its share price soar 115 percent.

Guangdong Province, with a population of about 83 million, saw its per capita GDP rise 50 percent to 19,316 yuan (US$2,391) over the past five years.

About 30 million square meters of residential property was sold in Guangdong last year, a rise of 20 percent over 2003. The average selling price in 2004 was 3,298 yuan per square meter, 10.4 percent higher than 2003.

Agile, which has 18 residential projects in the cities of Zhongshan, Guangzhou and Foshan, has a total land reserve of 6.5 million square meters gross floor area, which Morgan Stanley, the sponsor of the offering, estimates at a net asset value of 12.5 billion yuan.

Agile’s net profit more than doubled to 230 million yuan in 2004 and jumped 233 percent to 403.6 million yuan in the first six months of 2005 as its net profit margins rose to 17 percent from 8.9 percent in the first half of 2004.

(Shenzhen Daily November 29, 2005)