Shanghai, March 2 (Gasgoo.com) China's auto dealer Zhongsheng Group has decided to postpone its planned $800 million to $1 billion Hong Kong IPO due to volatile market conditions, Reuters reported today, citing a note sent to investors.
The company, which focuses on luxury and mid-to-high-end auto brands like Mercedes-Benz, Lexus, Audi, Nissan and Toyota, was originally scheduled to kick off a roadshow for the initial public offering (IPO) this week and to start taking orders on March 3.
Zhongsheng, based in northeastern city of Dalian, operates 47 "4S" shops across China. It plans to open 28 new dealerships and acquire 20 others this year.
The investment banking unit of Bank of China Ltd. estimated Zhongsheng's 2010 net profit at 1.15 billion yuan, more than double last year's 467 million yuan, as its network of dealership expands and product mix improves.
China overtook the U.S. last year as the world's largest auto market with sales rising 46% to 13.6 million vehicles. In the increasing competition, dealers will play a critical role for global automakers.
