By Clarence Leong
Xinjiang Daqo New Energy Co.’s stock price more than tripled in its Shanghai trading debut, in a sign of strong investor interest in China’s renewable energy industries.
The company, which is the major operating subsidiary of U.S.-listed Daqo New Energy Corp., raised 6.07 billion yuan ($938.5 million) in net proceeds from its initial public offering.
The majority of the proceeds will be used to fund manufacturing capacity expansion for polysilicon, a key raw material in solar panels.
The stock price surged to as high as CNY80.21 in Thursday morning trade on Shanghai’s STAR board, compared with its IPO price of CNY21.49. Its shares were last trading at CNY63.90.
The Xinjiang-based company looks set for outsized profits this year and the next thanks to a tight supply of polysilicon, U.S. investment bank Jefferies said. The A-share listing of Xinjiang Daqo could lead to a positive rerating of its U.S.-listed parent, Jefferies said.
Last month, the Shanghai listing of wind-energy generator China Three Gorges Renewables (Group) Co. also drew strong interest from investors. It stock jumped 44% in its first day of trading.
Write to Clarence Leong at firstname.lastname@example.org