Sinohydro cuts IPO size amid weak market

SINOHYDRO Group has cut the size of its proposed Shanghai IPO as weak sentiment has put a squeeze on stock market liquidity. The company now plans to sell 3 billion A shares and set a price range of 4.5-4.8 yuan per stock, according to a statement issued last night. This indicates it could raise up to 14.4 billion yuan (US$2.3 billion) in the stock sale. The builder of the Three Gorges Dam initially sought to issue 3.5 billion A shares to raise up to 17.3 billion yuan. The indicated price range translates into a valuation of 15-16 times 2010 earnings. Hongyuan Securities analyst Zhou Rongzi said in a report the price range was not high and recommended clients subscribe to the IPO.

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