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Sunac offers IPO at record low valuation as Kaisa prices at bottom

Fatigue for property stocks appears to spread as Sunac offers its shares at less than five times next year's earnings at the bottom of the range, and Kaisa's IPO is only about three times covered.

Sunac China Holdings has set a price range for its initial public offering that values the Tianjin-based developer below the other property companies that have listed in Hong Kong over the past couple of months. Based on a price per share between HK$2.90 and HK$3.70, the company is valued at 4.7 to 5.9 times its projected earnings for next year, according to a source -- well below the 10.4 times that Glorious Property Holdings achieved as the first-mover among the 10 property developers that have come to market since mid-September.

With a couple of exceptions, valuations have been trending lower since then but at the bottom of the range Sunac is looking cheap...

¬ Haymarket Media Limited. All rights reserved.

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