Great Wall lured by mainland boom time

GREAT Wall Motor Co said it plans to start selling shares on China's mainland bourse, aiming to raise more money from the booming market.

China's largest maker of pick-up trucks and sports utility vehicles may issue up to 151.1 million yuan-denominated A shares at one yuan (13 US cents) each to Chinese investors, according to a statement to the Hong Kong Stock Exchange yesterday.

The proposed new A-stock sale, which accounts for 16 percent of its total shares, still needs approval from its annual board meeting on June 28, the Baoding, Hebei Province-based Great Wall said.

The A-share sales came after it decided to issue the same number of H shares in Hong Kong last October as a way to fund production expansion of its engines and transmissions.

"The board will determine whether to issue H shares or A shares, but not both, depending on the prevailing market conditions at the time of the proposed issue," Great Wall said in the statement.

Xia Ping, an analyst from Core Pacific Yamaichi International (HK) Ltd, said the new plan reflects Great Wall's intention to gain more recognition. "The mainland stock market has higher valuation in car maker's shares compared with Hong Kong, which will help Great Wall to draw more capital," Xia said.

"Great Wall could also benefit from a good company reputation to further spur sales on the mainland."

China's benchmark stock index has surged 81 percent this year, attracting car makers including Guangzhou Automobile Industry Group Co Ltd and Beijing Automotive Industrial Holding Co.