China developers eye US$2.6 bln in HK IPOs -sources

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HONG KONG, Jan 31 (Reuters) - Four more Chinese property firms plan Hong Kong IPOs this year to raise a combined US$2.6 billion, sources told Reuters, as Beijing's clampdown on bank lending forces developers to brave stock market volatility.

With the Chinese government bent on staving off the kind of housing bubble that led to the U.S. subprime crisis, property firms are desperate to tap equity markets to stay afloat, with at least 10 companies now planning initial public offerings this year.

The listing hopefuls are shrugging off a 15 percent drop in Hong Kong's benchmark index .HSI so far this year on concerns about a U.S. recession and spreading credit market woes, which have scared off more than US$2 billion in planned Hong Kong IPOs recently.

Of the latest planned listings, the biggest will probably be worth US$800 million to US$1 billion from Palm Springs Real Estate Holdings, two people with knowledge of the deal told Reuters.

The company, which has residential and commercial property projects in Beijing, Hong Kong, Shenzhen and Chongqing, has tapped UBS (UBSN.VX) (UBS.N) as one of the sponsors of its Hong Kong listing, the people said.

HKI Properties Ltd plans to raise US$400 million to US$500 million in a Hong Kong IPO, with BOC International, Macquarie (MQG.AX) and Cazenove sponsoring the deal, three people familiar with the deal said.

Neither Palm Springs nor HKI have filed listing applications to the Hong Kong Stock Exchange, but both targeted to list in the second half of this year, the sources said.

Shenzhen-based Jia Zhao Ye Properties Ltd has tapped Credit Suisse (CSGN.VX) and BOC International to arrange an IPO worth US$400 million to US$500 million, two people familiar with that deal said.

And Zovy Ltd, based in Dongguan in the southern Chinese province of Guangzhou, has tapped Morgan Stanley (MS.N) and JP Morgan (JPM.N) to arrange its Hong Kong IPO, two sources close the deal said.

One of the sources said the firm expected to raise about US$600 million, but the final size of the deal would depend on market conditions.

Among measures to cool the construction industry, China has told banks to slash lending to property firms, and is employing a "use it or lose it" policy on land owned by developers. Analysts believe companies that fail to raise sufficient funds to build on their land will be snapped up by stronger rivals.

(US$1=HK$7.8) (Reporting by Kennix Chim; editing by Dominic Whiting)