Three Chinese mainland brokers are competing to become the first domestic securities house to launch an initial public offering in more than four years, sources said.
Orient Securities Co and Everbright Securities Co will likely debut on the stock market through the IPOs as early as next month, while China Merchants Securities might head off the other two by being the first to sell shares in two weeks at its earliest, according to people familiar with the matter.
China Merchants Securities applied to regulators for approval for its IPO in September last year, and it expects to raise as much as 14.6 billion yuan (US$2 billion). It was followed by Orient Securities and Everbright Securities. Sources said the latter two may also net more than 10 billion yuan from their IPOs.
China Merchants Securities reported a half-year net profit of 2.4 billion yuan in 2007 while Everbright made 2.1 billion yuan in the first half of last year. Orient Securities earned the smallest net profit of 1.57 billion yuan.
"This year we will see many brokers listing on the stock market to ride the bull. Players with stronger financial fundamentals will move faster to complete the debut in the first half of this year," said Xie Yan, an analyst with Haitong Securities Co.
Liang Jing, an analyst with Guotai Jun'an Securities Co, said the increasing number of listed brokerages will make the industry an important sector of the stock market this year.
Haitong Securities, Northeast Securities, Guoyuan Securities and Changjiang Securities were listed via back-door listings last year. Hong Yuan Securities and CITIC Securities were listed through IPOs in 1994 and 2003 respectively.
Huatai Securities, Galaxy Securities and Western Securities are also busy preparing to tap public funds through IPOs.
(Shanghai Daily January 9, 2008)
