ZTE Zooms on HK Debut

Chinese vendor shows there's an appetite for new telecom stocks

December 10, 2004

1 Min Read
ZTE Zooms on HK Debut

Chinese vendor ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) marked its listing on the Hong Kong stock exchange Thursday with an 11 percent rise in its share price, closing the day at HK$24.4 (US$3.11), up HK$2.4 from its offering price of HK$22 (see ZTE Sets IPO Price at HK$22).

That initial enthusiasm dampened a bit on the stock's second day of trading, however, as it dipped to close Friday's session at HK$24.05. Analysts at China International Capital Corp. Ltd. expect ZTE's stock to trade between HK$23.7 and HK$27.8.

Demand for ZTE's shares was overwhelming, which should give other telecom firms sizing up an IPO greater confidence. The 14.11 million shares originally set aside for retail investors were oversubscribed 253 times, leading the company to increase that tranche to 70.53 million, nearly half the 148.53 million shares floated.

The shares offered to institutional investors were 23 times oversubscribed.

ZTE raised nearly HK$3.27 billion (US$421 million) from the issue, more than half of which will be invested in the company's international expansion (see ZTE: Set for Overseas Explosion).

— Ray Le Maistre, International News Editor, Light Reading

For the latest intelligence and analysis of next-generation telecom market opportunities, check out the coming Light Reading Live! event: Light Reading's Telecom Investment Conference, at the exclusive Plaza Hotel in New York City, on Wednesday, December 15, 2004.

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