China's Jinduicheng rises 24 pct in Shanghai debut
SHANGHAI, April 17 (Reuters) - Shares in China's Jinduicheng Molybdenum rose 24 percent in their Shanghai debut on Thursday after Asia's top molybdenum producer raised 8.9 billion yuan ($1.27 billion), as investors were lured by strong prospects for demand for the metal.
Jinduicheng Molybdenum Group Co's (601958.SS) local-currency A shares opened at 20.60 yuan apiece, compared with their initial public offer price of 16.57 yuan.
Analysts had predicted a first-day trading range between 18.65 and 22.5 yuan.
Jinduicheng's is the first listing on a mainland bourse since small laser equipment maker Fujian Fujing Casttech 002222.SZ made its debut on the Shenzhen stock exchange on March 19.
Jinduicheng issued 538 million shares, or 20 percent of its expanded capital. The listing came in the wake of heavy losses in China's stock market due to worries over monetary tightening, excessive supply of new shares and the U.S. economic outlook.
The firm's business is boosted by solid demand from China, the world's largest stainless steel producer.
Prices of Molybdenum, used to toughen alloy steel and as a catalyst for chemical production and oil refining, are around $33 a pound in London MLY-OXIDE-LON, more than 10 times levels seen between 1999 and 2001.
Some analysts have warned, however, about the cyclical nature of Jinduicheng's business, which is tied to the automotive, shipbuilding and property sectors. The company produces 7 percent of the world's molybdenum.
Shares of Hong Kong-listed China Molybdenum Co (3993.HK), another major Chinese producer of the metal, have tumbled nearly 50 percent since the start of the year, compared with a nearly 15 percent drop in Hong Kong's benchmark Hang Seng Index .HSI. ($1=6.991 Yuan) (Reporting by Alfred Cang; Editing by Charlie Zhu and Edmund Klamann)
