CORRECTED-ANALYSIS-A123's smash-hit IPO could herald more green debuts 25 Sep 2009 09:32

(Corrects company name to BrightSource Energy, not Energies, paragraph 9)

* A123's market cap zooms over $1.9 bln on first day

* More venture-backed IPOs could hit market

* Investors looking for high-growth sectors

By Poornima Gupta

SAN FRANCISCO, Sept 24 (Reuters) - A 50 percent leap in the shares of lithium-ion battery maker A123 Systems Inc <AONE.O> on their first day of trading looks likely to jumpstart the market for clean-tech share offerings.

The Watertown, Mass.-based A123 Systems is now worth over $1.9 billion, a striking valuation for a company that has yet to make a profit and still needs large-scale commercialization.

Industry executives and experts said A123's success shows investors have an appetite for green technology companies that lose money, but have tremendous potential.

So the stock's first day jump, which is the second-best performance for a debut stock in 2009, should encourage more venture capital-backed clean technology companies to go public, they added.

"This is an interesting time for the market because there are several (clean-tech) companies that have been growing very nicely," said Faysal Sohail, managing director of venture fund CMEA Capital, which is an investor in A123.

Sohail declined to comment specifically on A123, but said the whole environment is creating opportunities for clean-tech companies and expects 2010 to be a busy year for green IPOs.

"They are real companies with substantial revenue and growing at a very fast clip," he said.

CMEA Capital also backs companies such as Silicon Valley solar manufacturer Solyndra and biofuel company Codexis, which many see as likely candidates for the IPO market.

Other green companies deemed ripe for an IPO include smart grid network company Silver Spring Networks, electric carmaker Tesla Motors and solar thermal company BrightSource Energy.

Rival lithium-ion battery maker Ener1 Inc <HEV.O> also cheered A123's stock performance, which shows how much value there is in the emerging sector.

"It's great for the space. They have done a good job of getting the market excited," Ener1 Chief Executive Charles Gassenheimer told Reuters.

Ener1 went public in 2003, but used a reverse merger with a public shell corporation to do so.

Gassenheimer said the warm reception of the IPO would encourage other clean-tech companies to tap the public markets.

"Any time you have an IPO trade up as much as 50 percent, that means investor receptivity has returned," he said. "I think you will see a lot more IPOs on the back of this."

HIGH GROWTH SECTORS

A123, founded by scientists linked to the Massachusetts Institute of Technology (MIT), develops batteries for electric vehicles, plug-in hybrids and works with carmakers such as BMW <BMWG.DE>, Chrysler and General Motors Co [GM.UL].

Electric vehicles and batteries are considered markets that have immense potential for growth.

The automotive market for lithium-ion batteries, mostly found in mobile phones and computer laptops, is projected to be $32 million in 2009, but is expected to skyrocket to $22 billion in 2015, according to A123's prospectus.

"That's compelling," said Matt Therian, an analyst with Renaissance Capital, referring to the market potential. "We have seen a lot of large profitable companies go public. But a smaller one with a little more risky profile ... I think it bodes well for the health of the IPO market."

Looking forward, Therian expected plenty of the larger, cash-generating, private equity portfolio companies would go public in 2010.

"But on their heels, we could also see another wave of your more traditional growth companies," he added.

For now, A123 co-founder Yet-Ming Chiang, a professor of ceramics at MIT's department of materials science and engineering, is happy but understands the company still needs to deliver.

"It's a scientist's and engineer's dream to see something from the lab make it to commercial technology that has an impact," Chiang said. "Even though this is a significant event, there is still a lot of work to be done and tomorrow we all get back to work." (Reporting by Poornima Gupta; additional reporting by Scott Malone in Boston; editing by Andre Grenon) ((poornima.gupta@reuters.com +1-415-677-3934; Reuters Messaging: poornima.gupta.reuters.com@reuters.net)) Keywords: A123/

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China MCC's Shanghai IPO freezes up $234 billion 11 Sep 2009 08:55

* MCC Shanghai IPO freezes 1.6 trillion yuan ($234 billion)

* Demand may push its Shanghai shares up 40 pct on listing

* Plus HK offer, MCC IPO will be world's 2nd largest in 2009

By Lu Jianxin and Jacqueline Wong

SHANGHAI, Sept 11 (Reuters) - Metallurgical Corp of China (MCC), which is raising up to $5.3 billion in the world's second-largest initial public offering (IPO) this year, has seen the subscriptions to its Shanghai portion of the IPO freezing up a huge 1.6 trillion yuan ($234 billion), boding well for its listing debut later this month.

MCC, one of China's biggest engineering and construction firms, which is also active on global markets, sold 3.5 billion shares in Shanghai, or 21 percent of its expanded capital, at 5.42 yuan per share, the top end of an indicated price range, it said in a statement on Friday.

MCC has said it needs funds from the Shanghai IPO to develop overseas projects including a copper mine project in Afghanistan. It also needs funds for technical upgrades, equipment purchases, property development and supplemental working capital.

A company document issued on Thursday said MCC would start trading in Shanghai on Sept. 21 and in Hong Kong on Sept. 24.

CITIC Securities <600030.SS> was the Shanghai IPO's sole lead underwriter, while Morgan Stanley <MS.N>, Citigroup <C.N> and China International Capital Corp (CICC) are among book runners for the Hong Kong deal.

Initial analysts' estimates for its Shanghai listing debut price stand at around 7.5 yuan, rising about 40 percent from its IPO price because of huge demand and typically strong Chinese investor interest in newcomers. The estimations could be adjusted slightly in line with stock market conditions.

MCC's main retail portion of the Shanghai IPO was 91 times subscribed on Wednesday, freezing up 1.04 trillion yuan, according to Reuters calculations based on figures quoted by MCC's Friday statement published on the Shanghai Securities News.

The remaining institutional portion was 75 times subscribed on Tuesday, locking in 566 billion yuan, according to the statement. Money would be returned to unsuccessful bidders on Friday for institutions and for retail investors on Monday.

Fund demand ahead of MCC's IPO pushed China's weighted average seven-day bond repurchase rate <CN7DRP=CFXS>, the barometer of liquidity on the money market, to a one-month high of 1.80 percent on Monday, though the rate has since fallen back.

MCC is also selling up to 2.87 billion H shares in Hong Kong worth as much as HK$19.55 billion ($2.5 billion).

If it prices its H shares also at the top of an indicated price range of HK$6.16 to HK$6.81, it will raise $5.3 billion combining with the Shanghai portion to be the world's second largest IPO this year, only below China State Construction Engineering Corp's <601668.SS> $7.3 billion IPO in July [ID:nSHA330047].

MCC will use the H-share proceeds to fund payment of mining rights in Afghanistan, Argentina and Pakistan, and to fund iron and steel mine projects in Australia, India, Vietnam and Mongolia. Proceeds will also be used to repay bank borrowings and to fund potential acquisitions of overseas mineral resources. (US$1=6.83 Yuan=HK$7.8)

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Stock market may collapse again, TCW's Gundlach says

Sept 09 09

By Alistair Barr, MarketWatch

SAN FRANCISCO (MarketWatch) -- The stock market's recent rally is likely to run out of steam soon and equity prices may collapse again, Jeffrey Gundlach, chief investment officer at Los Angeles-based mutual-fund giant TCW Group Inc., said Wednesday.

The benchmark Standard & Poor's 500 index is "extremely unlikely" to climb above 1,100, before collapsing again, he said during a conference call.

"You've made 90% of the money you're gonna make in this rally," Gundlach said, advising investors to sell on strength when the S&P 500 is above 1,000.

The S&P 500 closed at 1,033 Wednesday, leaving it up more than 50% since early March.

Gundlach, who also runs TCW's flagship Total Return Bond Fund /quotes/comstock/10r!tglmx (TGLMX 9.98, -0.01, -0.10%) , had spotted cracks that subprime mortgages were forming in the financial system by June 2007 and was among the first to warn that an era of easy money would come to a bad end. See full story on Gundlach's warning.

His new concern is the massive debt being accumulated by the U.S. government as it tries to stimulate an economy that's been mired in the worst recession since the World War II.

"We're basically borrowing money and calling it economic growth," he said on Wednesday. "It's not real economic activity."

Debt-fueled government stimulus, such as the "cash for clunkers" program, may keep the U.S. economy growing for one or two years, but then growth will probably "just die," Gundlach said.

Cash for clunkers, in which the government gave up to $4,500 to new car buyers if they handed in old gas-guzzling vehicles, illustrates another of Gundlach's concerns, that of deflation.

"Deflation is so strong that you can't even sell cars unless you slash prices 20% through government subsidies," he said.

Gundlach is similarly bearish on credit markets and commodity prices, arguing that "a turning point is close at hand in these markets."

One of the few areas he's bullish on is the U.S. dollar -- but not for good reasons.

Gundlach sees such large debt defaults in coming years that he thinks the trend will cut the supply of dollars, pushing up the currency's value.

"We're standing on the edge of a major default wave," he said. "Defaults are the elimination of dollars. You could eliminate so much actual wealth that this could be the source of a strong dollar rally."

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SPDR Gold Trust holdings flat at 1,077.63 tonnes 10 Sep 2009 07:16

TOKYO, Sept 10 (Reuters) - The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust <GLD>, said its holdings stood at 1,077.63 tonnes as of Sept. 9, unchanged from the previous day.

For details on the gold holdings of the ETF listed in New York and co-listed on other exchanges, click on:

http://www.exchangetradedgold.com/iframes/usa.php

The holdings of the trust, which issues securities backed by physical stocks of gold, have declined in recent months due to fading worries about inflation, which has sapped investors' appetite for bullion as a hedge. <XAUEXT-NYS-TT>

Following are changes in SPDR holdings;

Date: Total tonnes

Sept 4 1,077.63

Sept 3 1,078,01

Sept 2 1,063.36

Aug 25 1,061.83

Aug 21 1,066.41

Aug 11 1,065.49

Aug 10 1,068.55

Aug 7 1,068.90

July 29 1,072.87

July 28 1,083.25

July 22 1,086.61

July 21 1,092.41

July 17 1,094.54

July 16 1,094.85

July 14 1,094.54

July 8 1,109.81

July 6 1,120.19

June 30 1,120.55

June 25 1,125.74

June 22 1,131.24

June 5 1,132.15

June 3 1,132.50

June 1 1,134.03 -- record

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FACTBOX-How to invest into gold and key price drivers 08 Sep 2009 09:32

Sept 8 (Reuters) - U.S. gold futures hit $1,000 an ounce for the first time since February as the dollar's weakness, concerns about the sustainability of global economic recovery and worries about future inflation underpinned sentiment. Following are key facts about the market and different ways to invest in the precious metal. HOW DO I INVEST? SPOT MARKET Large buyers and institutional investors generally buy the metal from big banks. London is the hub of the global spot gold market, with some $18 billion in trades passing through London's clearing system each day. To avoid cost and security risks, bullion is not usually physically moved and deals are cleared through paper transfers. Other significant markets for physical gold are India, China, the Middle East, Singapore, Turkey, Italy and the United States. FUTURES MARKETS Investors can also enter the market via futures exchanges, where people trade in contracts to buy or sell a particular commodity at a fixed price on a certain future date. The COMEX division of the New York Mercantile Exchange is the world's largest gold futures market in terms of trading volume. The Tokyo Commodity exchange, popularly known as TOCOM, is the most important futures market in Asia. China launched its first gold futures contract on January 9, 2008. Several other countries, including India, Dubai and Turkey, have also launched futures exchanges. EXCHANGE-TRADED FUNDS The wider media coverage of high gold prices has also attracted investments into exchange-traded funds (ETFs), which issue securities backed by physical metal and allow people to gain exposure to the underlying gold prices without taking delivery of the metal itself. Gold held in New York's SPDR Gold Trust <GLD> <XAUEXT-NYS-TT>, the world's largest gold-backed ETF, rose to a record high of 1,127.68 tonnes on April. The ETF's holdings are equivalent to nearly half global annual mine supply, and are worth some $34 billion at today's prices. Other gold ETFs include iShares COMEX Gold Trust <IAU>, ETF Securities' Gold Bullion Securities <GBSx.L> and ETFS Physical Gold <PHAU.L>, and Zurich Cantonal Bank's Physical Gold <ZGLD.S>. BARS AND COINS Retail investors can buy gold from metals traders selling bars and coins in specialist shops or on the Internet. They pay a small premium for investment products, of between 5-20 percent above spot price depending on the size of the product and the weight of demand. KEY PRICE DRIVERS: INVESTORS Rising interest in commodities, including gold, from investment funds in recent years has been a major factor behind bullion's rally to historic highs. Gold's strong performance in recent years has attracted more players and increased inflows of money into the overall market. U.S. DOLLAR The currency market plays a major role in setting the direction of gold, with bullion prices moving in the opposite direction to the U.S. dollar. Gold is a popular hedge against currency weakness. A weak U.S. currency also makes dollar-priced gold cheaper for holders of other currencies and vice versa. OIL PRICES Gold has historicaLly had a strong correlation with crude oil prices, as the metal can be used as a hedge against oil-led inflation. Strength in crude prices also boosts interest in commodities as an asset class. POLITICAL TENSIONS The precious metal is widely considered a "safe-haven", bought in a flight to quality during uncertain times. Major geo-political events including bomb blasts, terror attacks and assassinations can induce price rises. Financial market shocks, which cause other asset prices to drop sharply, can have a similar effect. CENTRAL BANK GOLD RESERVES Central banks hold gold as part of their reserves. Buying or selling of the metal by the banks can influence prices. In March 2004, 15 European central banks renewed a 1999 pact to limit their gold sales over a five-year period to 2,500 tonnes, with annual sales limited to 500 tonnes, up from 2,000 tonnes in the first agreement. Sales under the pact have been relatively low in recent years, however. In 2007-2008 the signatories of the pact sold only 358 out of a possible 500 tonnes, and sales this year have reached only 144 tonnes so far this year, according to the latest figures available from the World Gold Council. A third Central Bank Gold Agreement was announced in August, which limits the signatories' sales to 400 tonnes a year. HEDGING Several years ago when gold prices were languishing around $300 an ounce, gold producers sold a part of their expected output with a promise to deliver the metal at a future date. But when prices started rising, they suffered losses and there was a move to buyback their hedging positions to fully gain from higher market prices -- a practice known as de-hedging. Significant producer de-hedging can boost market sentiment and support gold prices. SUPPLY/DEMAND Supply and demand fundamentals generally do not play a big role in determining gold prices because of huge above-ground stocks, now estimated at around 158,000 tonnes -- more than 60 times annual mine production. Gold is not consumed like other commodities. Peak buying seasons in major consuming countries such as India and China exert some influence on the market, but others factors such as the dollar and oil prices carry more weight. (Compiled by Atul Prakash and Jan Harvey; editing by Ben Tan) ((ben.tan@thomsonreuters.com; +65 6870 3923; Reuters Messaging: ben.tan.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)) Keywords: MARKETS GOLD/INVESTMENT

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Hong Kong IPO Pipeline - Sept 7 07 Sep 2009 14:03

     HONG KONG, Sept 7 (Reuters) - The following are some of the 
major companies planning initial public offerings on the Hong 
Kong stock exchange. 
    Please contact Fion Li at (+852) 2843-6936 to submit entries 
for this diary. 
    Click on the square bracket for the latest story. 
    * Denotes new entry or update 
    ** A- and H-shares combined 
=============================================================== 
DEBUT  COMPANY            SHRS   PRICE     MANAGERS    PROCEEDS 
DATE                     (MLN)  (HK$/SHR)              (US$MLN) 
=============================================================== 
*Sept Sinopharm         545.68  12.25-16  CICC, UBS      1,130 
23    Holdings                          Morgan Stanley 
      [ID:nHKG284282]                 Citigroup, Deutsche 
--------------------------------------------------------------- 
*Sept China Metallurgical 2610  6.16-6.81  Morgan Stanley 4,000** 
24    Group             A 3500  5-5.42 yuan  CICC, Citigroup, 
      [ID:nHKG225209]                     Citic Securities 
      [ID:nSHA30547] 
      (A-share listing in Shanghai on Sept 21) 
--------------------------------------------------------------- 
*Sept China Lilang        300     3.2-4  Bofa Merrill Lynch 155 
25    Ltd                                   HSBC 
      [ID:nHKG225209] 
--------------------------------------------------------------- 
*Sept Yingde Gases        N.A.    N.A.      Morgan Staley   300 
2009  [ID:nHKG155161]                          Goldman 
      [ID:nHKG54140] 
--------------------------------------------------------------- 
Sept  China South         N.A.    N.A.     Merrill Lynch,   513 
2009  City Holdings                           BOCI 
      [ID:nHKG232386] 
--------------------------------------------------------------- 
OCT   China Vanadium      N.A.    N.A.       Citigroup      200 
2009  Titano Magnetite 
      Mining Co Ltd 
      [ID:nHKG218674] 
--------------------------------------------------------------- 
OCT   China SCE           N.A.    N.A.   Deutsche Bank,     400 
2009  Property Holdings                  Morgan Stanley 
      [ID:nHKG320663] 
--------------------------------------------------------------- 
Q4    Wynn Macau          N.A.    N.A.  JPMorgan, UBS 500-1,000 
2009  <WYNN.O>                         Morgan Stanley 
      [ID:nSP478097] 
--------------------------------------------------------------- 
Q4    Lung Ming           N.A.    N.A.                500-1,000 
2009  [ID:nHKG44842] 
--------------------------------------------------------------- 
Q4    Longyuan            N.A.    N.A.    Morgan Stanley    700 
2009  Electric 
      [ID:nHKG185111] 
--------------------------------------------------------------- 
*H2   Las Vegas           N.A.    N.A.    Goldman   1,500-2,000 
2009  Sands' <LVS.N> 
      Macau assets 
      [ID:nN02534339] 
      [ID:nSIN441766] 
--------------------------------------------------------------- 
2009  Fantasia Group      N.A.   N.A.      UBS, Goldman     500 
      [ID:nHKG164817] 
--------------------------------------------------------------- 
End   Evergrande Real     N.A.    N.A.     CS, Goldman    1,500 
2009  Estate Group                        Merrill Lynch 
      [ID:nHKG164817] 
--------------------------------------------------------------- 
End   China Minsheng      3,320   N.A      UBS, BOCI      2,930 
2009  Banking Corp 
      <600016.SS> 
      [ID:nnSEO13647] 
--------------------------------------------------------------- 
End   Sany Heavy          N.A.    N.A.       HSBC           200 
2009  Equipment Co 
      [ID:nHKG259152] 
--------------------------------------------------------------- 
End   Trinity             N.A.    N.A.     JP Morgan,       200 
2009  [ID:nHKG129890]                      Citigroup 
--------------------------------------------------------------- 
2009  China Pacific       N.A.    N.A.        CICC        3,500 
/2010 Insurance (Group)                     CS, UBS 
      Ltd <601601.SS>                       Goldman 
      [ID:nSHA309267] 
--------------------------------------------------------------- 
2009/ Powerlong Group     N.A.    N.A.    UBS, Goldman      230 
2010  [ID:nHKG168099] 
--------------------------------------------------------------- 
2009  Glorious Property   N.A.   N.A.    UBS, JP Morgan   1,000 
/2010 Holdings                            Deutsche Bank 
      [ID:nHKG164817] 
--------------------------------------------------------------- 
Q1    AIA <AIG.N>         N.A.    N.A.    Morgan Stanley  4,000 
2010  [ID:nHKG20632]                      Deutsche Bank 
--------------------------------------------------------------- 
2010  Wilmar              N.A.   N.A. BOCI, Goldman 3,000-4,000 
      International's                  Morgan Stanley 
      <WLIL.SI> China unit 
      [ID:nHKG120371] 
--------------------------------------------------------------- 
*2010 Xinjiang Goldwind  242-278  N.A.                    1,000 
      Science & Technology 
      <002202.SZ> 
      [ID:nSHA150131] 
-------------------------------------------------------------

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SPDR Gold Trust holdings rise 1.4 pct to 1,078.01 T 04 Sep 2009 06:58

TOKYO, Sept 4 (Reuters) - The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust <GLD>, said holdings stood at 1,078.01 tonnes as of Sept 3, up 14.65 tonnes or 1.4 percent from the previous business day.

For details on the gold holdings of the ETF listed in New York and co-listed on other exchanges, click on:

http://www.exchangetradedgold.com/iframes/usa.php

Holdings in the trust, which issues securities backed by physical stocks of gold, have declined in the past months due to fading worries about inflation, which has sapped investors' appetite for bullion as a hedge. <XAUEXT-NYS-TT>

Following are changes in SPDR holdings;

Date: Total tonnes

Sept 3 1,078,01

Sept 2 1,063.36

Aug 25 1,061.83

Aug 21 1,066.41

Aug 11 1,065.49

Aug 10 1,068.55

Aug 7 1,068.90

July 29 1,072.87

July 28 1,083.25

July 22 1,086.61

July 21 1,092.41

July 17 1,094.54

July 16 1,094.85

July 14 1,094.54

July 8 1,109.81

July 6 1,120.19

June 30 1,120.55

June 25 1,125.74

June 22 1,131.24

June 5 1,132.15

June 3 1,132.50

June 1 1,134.03 -- record

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