A CONSTRUCTION firm based in China’s north-east with a string of commercial and civic projects under its belt is listing in Singapore.

Sino Construction aims to raise net proceeds of $35.6 million with its initial public offering (IPO) of 152 million shares priced at 39 cents apiece.

The company’s customers are mainly property and infrastructure developers and government-related bodies.

The offer, launched yesterday, comprises 6.4 million public-offer shares and 146 million placement shares.

Of the proceeds, $17.5 million has been earmarked for a concrete mixing base, $10 million will be used to purchase construction equipment, and the rest will serve as general working capital.

The company is a leading contractor in Daqing City, one of the most economically developed cities in China’s north-east. It has worked on a number of public buildings in the city, including hospitals and university campuses.

The company turned in a net profit of 168.5 billion yuan (S$33.18 billion) last year. Turnover was 1.16 billion yuan. It has a historical price-to- earnings ratio of 5.85 times.

The company’s chief executive and executive chairman, Mr Zhao Chuan Wen, is confident of the company’s growth prospects, despite the rising costs of raw materials.

‘The company has strong financial resources and a good track record, as well as an experienced management team that will distinguish us from our competitors,’ he said.

The firm has just been invited to tender for Daqing airport and some railway station projects. It is looking to expand overseas.

It also intends to distribute a dividend of at least 20 per cent of its net profit.

The offer closes next on Tuesday, and the shares are due to start trading next Thursday.

Source : Straits Times - 6 June 2008