China South Locomotive disappoints in HK

Shares in China’s largest train maker, China South Locomotive, rose a disappointing 1% in their Hong Kong debut, Reuters said. Despite raising a healthy US$1.5 billion in its dual initial public offering in Shanghai and Hong Kong, China South Locomotive could not overcome Thursday’s 2.6% drop in the Hang Seng Index. The stock rose as high as HK$3.08 (US$0.39) during morning trading, up from its IPO price of HK$2.60 (U$0.33), but fell back to close at HK$2.63 (US$0.34). "Fundamentally, the stock is attractive as it will benefit from China’s transportation expansion plan and its valuation is low, but stock markets are so weak, the firm is under selling pressure in the short term," said Teresa Chow, fund manager at RBC Investment Management. The comapny’s Shanghai-listed A-shares closed down 10%.