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China Construction Shares Up 33% in Shanghai Debut

Shares in China Construction Bank (CCB), the country's No.2 bank by assets, jumped 33% in their Shanghai debut on Tuesday, as analysts predicted higher earnings growth compared with other big Chinese lenders.

CCB's local currency A shares opened at 8.55 yuan, up 32.56% from its IPO price of 6.45 yuan. The stock quickly shot up to as high as 9.05 yuan for a 40% gain.

The shares had been expected to trade at 9-10 yuan on their first trading day, according to a Reuters poll of six analysts.

The opening price represented a 16% premium to the bank's Hong Kong-listed H shares, which last closed at HK$7.64.

CCB raised a record 58 billion yuan (US$7.7 billion) in last week's IPO, attracting 2.26 trillion yuan of subscriptions -- another record -- for an oversubscription ratio of 38 times.

That compares favorably with the biggest bank, Industrial & Commercial Bank of China, which saw an oversubscription ratio of 16 times in the Shanghai portion of its IPO last October. Its A shares ended their first day of trade up only 5%.

The June 2006 domestic offer of Bank of China, the biggest foreign exchange lender, was 32 times oversubscribed and the bank's A shares rose 23% on their debut.