Yunnan Copper Industry, the mainland's third-biggest smelter of the metal, plans to raise 6 billion yuan (HK$6.81 billion) through a share placement to buy mining assets from its parent and repay debt.
The Shenzhen-listed company is the latest metal producer to express a desire to capitalise on the vibrant stock market, after Aluminum Corp of China (Chalco), which is looking to sell new shares on the Shanghai market, and Angang Steel, which aims to raise funds in Hong Kong.
Helen Lau, an analyst at OSK Securities, expects more metal producers to follow suit because of ample liquidity in the market, the recovery in metal demand and prices, and the jump in their share prices.
The Shanghai Composite Index rose 31.875 points or 0.97 per cent to 3,328.49 yesterday, the gauge's highest close in 13 months.
Hong Kong's benchmark Hang Seng Index also ended at its highest level in more than 10 months, rising 2.96 per cent to 19,817.7 points.
'Investors' risk appetite is increasing, especially for China-related stocks, as they expect demand for raw materials such as steel will increase with the strong recovery of the mainland economy,' Ms Lau said.
Yunnan Copper will sell as many as 300 million new shares to no more than 10 institutional investors for at least 20.59 yuan each after gaining approval from shareholders and the mainland securities watchdog.
