Chinese Auction Giant Soars 29% in Hong Kong Debut
Shares in the first Chinese auction house to be listed in Hong Kong closed up 29 percent on their debut Thursday, following the firm's $331 million initial public offering.
Poly Culture Group, the world's third largest auction house by revenue behind Sotheby's and Christie's, made a splash with shares reaching HK$42.60 (U.S.$5.49) by the end of trading.
The overall index ended up 0.55 percent.
The southern Chinese city has in recent years become a hub for auctions thanks to increasing wealth in China and other parts of Asia.
Poly said in a statement it priced its shares at the top end of its indicative price range of HK$28-33, after the retail tranche of its IPO was over-subscribed more than 600 times.
It described itself as a "leading" enterprise in China with operations in art auctions, theater management and cinema, in a prospectus filed to the city's stock exchange.
Hong Kong was the world's top IPO venue from 2009 to 2011, and while business has decreased recently the New Year has started with a bang, especially for less orthodox companies.
Magnum Entertainment, the city's first nightclub to list on the bourse, saw its HK$126 million IPO oversubscribed 3,500 times. Its share price soared 90 percent on the first day.
Fu Shou Yuan, the largest mainland Chinese funeral services provider, saw its December $215 million IPO oversubscribed by nearly 700 percent.
Analysts said Thursday's gains were expected due to Poly's strong name recognition in China.
"I think it's mainly due to the brand name effect," said Peter Pak, head of trading at Bank of China International Securities, describing Poly as a "powerful name in China".
Poly Culture is a subsidiary of Poly Group, a state-run conglomerate engaged in real estate, mineral resources and military equipment.
But the company stressed there is "clear delineation" between the parent company, which was under the supervision of the People's Liberation Army until 1999, and itself.
Source: Agence France Presse
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