Sinotrans Shipping, hit by a freight rate slump, only managed to raise HK$11.45 billion (US$1.47 billion) at its debut on the Hong Kong stock exchange Friday after falling 13 per cent to HK$7.12 a share from its HK$8.18 offer price, Bloomberg reported.
"The growth of imports of iron ore in China has slowed over the past few months," said Edward Wong, an analyst at Quam Ltd. in Hong Kong. Dry-bulk "share prices have had a good run this year and investors are taking profits."
Reflecting a sector wide slump, China Cosco Holdings also fell 7.4 per cent to HK$25.20 and Pacific Basin Shipping declined 4.9 per cent to HK$13.50.
"We are very confident about our profitability in 2008 and beyond," said Zhao Huxiang, president of China National Foreign Trade Transportation (Group) Corp., Sinotrans' parent. "Asia, especially China, has strong demand for dry-bulk shipments."
The pre-debut share sale was reportedly 252 times over subscribed at the November 19 sale and international institutions sought about 85 times the shares available to them.
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