XINJIANG Goldwind Science & Technology Co, China's biggest wind turbine maker by market share, plans to raise 1.8 billion yuan (US$244 million) in an initial share sale in Shenzhen to fund expansion.
Urumqi-based Goldwind will sell 50 million A shares at 36 yuan apiece, according to a statement to the Shenzhen Stock Exchange yesterday. Subscription started yesterday and will continue today. The firm didn't say when the shares will start trading. Goldwind has said it would use the proceeds of the IPO to boost output, finance research and marketing.
Analysts expect a strong debut for the firm's shares, given its leading position in the domestic industry and the government's push for renewable energy.
Goldwind's listing prospectus said it produced one-third of China's newly added wind-power equipment in 2006, and 2.8 percent of the world's new capacity last year.
Shenyin Wanguo Securities said Goldwind may trade between 66 yuan and 72 yuan, which would represent a price-to-earnings ratio of 55 to 60 times. By comparison, Denmark's Vestas Wind Systems, the global industry leader, trades at 53 times forecast 2007 earnings, Spain's Gamesa at 32 and India's Suzlon Energy Ltd at 63.
Currently, the core business of almost all mainland-listed companies involved in wind-equipment making is electrical equipment production.
"So Goldwind's listing would reignite investors' interests in the sector as it is a pure wind company," said Xiao Shijun, an analyst at TX Investment Consulting.
China's installed wind capacity has been doubling on year and stood at 3,600 megawatts at the end of the first half of this year.