China SOEs prepare for Hong Kong listings

Chinese state-owned enterprises Sinopec Engineering and Galaxy Securities won approval to issue shares in Hong Kong, potentially setting up the IPO market for a rebound, the South China Morning Post reported. The companies could raise a combined total of US$2.5 billion. Sinopec Engineering, the construction and engineering arm of China Petroleum & Chemical Corp (Sinopec; SNP.NYSE, 600028.SH, 0386.HKG), plans to offer shares at a price-to-earnings ratio of more than 10 times, valuing the company at between US$1 billion and US$1.5 billion, said people with knowledge of the transactions. China Galaxy Securities, the mainland’s seventh-largest brokerage by assets, plans to raise at least US$1.5 billion in the third quarter.