Xinyi Energy to conclude Hong Kong IPO on May 28

Chinese solar power firm Xinyi Energy Holdings Ltd expects its shares to start trading on the Hong Kong Stock Exchange (HKEX) on May 28.

The stock code will be (HKG:03868), the firm said today in an update on its initial public offering (IPO).

Xinyi Energy is selling 188.3 million shares in Hong Kong and over 1.69 billion international offer shares. A pricing range of HKD 1.89 to HKD 2.35 per share has been set by the company, a unit of solar glass maker Xinyi Solar Holdings Ltd (HKG:00968). At the top of that range, it would raise more than HKD 4.4 billion (USD 560.6m/EUR 500m).

The spin off of Xinyi Solar's power unit is necessary because the market position and the valuation methodology of the two businesses are very different. Xinyi Solar, as a photovoltaic (PV) glass maker, is in the industrial sector and is typically valued by investors on price-to-earnings multiples. Xinyi Energy, on the other hand, is a dividend-oriented company which owns, acquires and operates stable revenue generating solar power plants. It will adopt a high dividend payout policy to distribute a substantial portion of its cash flow as dividend and will be valued on a distribution yield basis, Xinyi Solar explained previously.

Xinyi Energy holds and operates a portfolio of 954 MW of utility-scale ground-mounted solar farms in China and is to acquire 540 MW more with the IPO proceeds.

(HKD 10 = USD 1.28/EUR 1.14)

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