China to bears: we can wait
May 25
Peter Wonacott | Wall St Journal | Shanghai
Some of China's biggest companies, facing a sceptical market overseas, have made it clear they can afford to wait to sell their stock to foreigners.
A few months ago, China stocks were hot and the window of opportunity seemed wide. Behemoths in industries such as cars, steel and banking were sprucing up for stock listings. Those listings are now fading from sight, and analysts have slashed estimates that China will triple the $US7billion its companies raised overseas in 2003.
The reasons are partly linked to worries about China's economy and the transparency of its companies. At the same time, Chinese executives say they are not inclined to rush to list overseas when they can generate plenty of cash at home.
"The stockmarket is just one way to raise capital. We can also get low-interest loans and issue bonds," said Miao Wei, head of Dongfeng Motor, one of China's biggest car makers. Some investment bankers pegged Dongfeng for a 2004 listing, but Mr Miao declined to discuss the timing.
Sector giants Baoshan Iron & Steel and Bank of China, which some analysts projected as 2005 listings, say they may wait even longer. Baoshan, the biggest steel maker in China and part of the Shanghai Baosteel Group, had not abandoned plans for an overseas listing, said chief executive Ai Baojun. But there was "no urgent need" to pursue it.
Likewise, Bank of China had "no pressing timetable", said an executive.
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