Agricultural Bank of China Ltd. shares were witnessed to register a slight climb over 22% during its first trading day in Shanghai, getting the lender back on the right path for a smaller first-day trading growth witnessed in the city compared to its four major rivals.
The bank hails to have the largest number of customers in its web.
The bank marked a rise 2.70 Yuan (40 cents) at 11:30 a.m. trading break from the IPO price of 2.68 Yuan, extending a market capitalization worth $127 billion. Earlier, the stock had touched 2.74 Yuan.
However, analysts cited that disappointing sentiment has landed the bank in a difficult situation to opt for the greenshoe option on the offering.
Shen Jun, a strategist at BOC International (China) Ltd., explained, "The performance is weaker than expected. Many individual investors are in a rush to sell the stock around CNY2.72 to make a profit as they are worried the stock will drop below the IPO price in the coming days".
It has been cited that the second reason behind Chinese investor’s inhibition towards banks is their massive fund-raising efforts launched in a bid to accumulate capital, after issues related to the quality of the assets.
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