[shiver]

Hi guy,

Just wanted to have some comments from the guru in investments..

What do you think of China CITIC Bank Corporation Limtied (IPO)

[PDLM]

For me the fundamental problem with any IPO in HK is that the over-subscription rate is so high that to get any significant allocation of shares you have to tie up several million dollars (either cash or margin financing) for a couple of weeks every time, and, as a casual investor, I really don't have the time to faff about manipulating my money around to do this. Even when you've tied up millions of dollars you end up with a few thousand dollars of shares which then need to go up by 50%+ to cover the costs (direct and opportunity) associated with financing the application. It's hardly worth all the effort - the only people doing well from this are the banks who are, er, laughing all the way to the bank.

[freeier]

same view. in this climate u are going to make money, but the effort to make a few k of hkd is too troublesome to be worth the shifting of assets around.

[philippe]

First I check the company background:

1. Is this the type of company/product/service I am looking for to enhance my portfolio?

2. Is this company one industry leader or does it have the potential to become one?

3. If the answer is yes I will try to get shares during the IPO and I am going to buy some shares in the following year no matter what (except if the price is too hot). For example I have some BOC shares, only one lot came from the IPO the rest of it I purchased in Q4 last year. I did not get any China Agri shares during the IPO but since I am bullish on bio fuels in the long run I grabbed a bunch of 606 on the first day of trading at a much higher price.

4. If you don't know about the company's prospect you can allways make some money if you know the herd will go for it (look at all the IPOs YTD) assuming you can get a few lots and sell them ASAP.

5. It's probably best to subscribe for IPOs on the last day so that your cash is not tight for too long. If I get no lot(s), I loose HK$50 no big deal. It is even more important if you want to borrow money to properly time your subscription. I am not borrowing but a friend of mine had some success with this approach.


In this case here is what I found:
Estimated profit for 07: not less than RMB 5.7 billion
Estimated EPS: RMB 0.17 (close to 50% up from 06)
Prospective PE: 30-35 times

I am not a fan of high PEs (this is a bank after all) but I guess the herd is going for it. Most analysts will probably advise to stay away from it but I could be wrong.

Good Luck.

[shiver]

Very satisfying comment Philippe.. Thanks..
i did look at the info's sounds pretty good


http://www.hkex.com.hk/listedco/list...0070416020.htm