Sinohydro Prices IPO on Low End at 4.5 Yuan

(Beijing) -- Sinohydro Group Ltd. (SHE: 601669) priced its initial public offering on the low end of its price range of 4.50 yuan and 4.80 yuan per share, the company said in a filing to the Shanghai Stock Exchange on September 28.

Based on the price of 4.50 yuan per share, which represents 10.23 times Sinohydro's price earnings ratio for 2010, the company will raise 13.5 billion yuan from the IPO, according to the statement.

An investment banker told Caixin the price could have been higher if the overall domestic market were not so bad.

The banker added that Sinohydro, a hydropower construction company, has a relatively good corporate structure among China's state-owned companies.

In response to a chilly reception from investors, Sinohydro on September 25 scaled down its IPO size from the original 3.5 billion shares to 3 billion shares, which account for 29.7 percent of its expanded equity.

The company booked 50.7 billion yuan in revenue for the first half of 2011, with net profit at 1.8 billion yuan, according to the prospectus.

China Communications Construction Company also recently received regulatory approval for its listing on the Shanghai Stock Exchange. The state firm plans to raise 20 billion yuan by issuing up to 3.5 billion shares, which will be the largest IPO on the mainland stock market so far this year.