China South Locomotive set for Shanghai IPO on Aug 5

China South Locomotive & Rolling Stock Corp Ltd (SHA 601766) said it will launch retail subscriptions on Aug 5 for its initial public offering in Shanghai, with sales to institutional investors scheduled for Aug 4-5.

The company is planning to issue up to 3 bln A-shares in Shanghai, representing no more than 25.86 pct of its enlarged share capital, including the planned H-shares to be issued soon.

According to a prospectus filed with the Shanghai Stock Exchange, up to 750 mln A-shares will be sold to institutional investors and the remainder will be sold to retail investors.

The rail equipment maker said it will start a roadshow tomorrow in Beijing, Shanghai, Shenzhen and Guangzhou.

China International Capital Corp and Industrial Securities Co Ltd will be joint lead underwriters for the IPO.

Proceeds from the offer will fund several projects, including those aimed at strengthening its capacity for building high-speed railcars, urban light railcars and key parts.

According to the prospectus, the size of the planned Hong Kong IPO has been cut 1.6 bln H-shares, representing up to 13.79 pct of its enlarged share capital, and 1.84 bln if the over-allotment option is exercised .

According to a draft prospectus filed with the China Securities Regulatory Commission last month, the company originally planned to issue up to 2 bln H-shares, with an option to issue 2.3 bln .

The company did not explain the reduction.

It said the IPO price for Hong Kong should not be less that the price for the Shanghai listing, but the final price will depend on the market situation.

Earlier this month, CNR Corp Ltd, the listing vehicle of its biggest rival -- state-owned China Northern Locomotive & Rolling Stock Corp Ltd - started operations. The vehicle also plans to issue A-shares in the second half of the year.