Nov. 8 (Bloomberg) -- China Merchants Securities Co. plans to raise as much as 11.1 billion yuan ($1.6 billion) in an initial share sale in Shanghai.

The Shenzhen-based brokerage will sell as many as 358.5 million shares at 26 yuan to 31 yuan each, according to a statement to the Shanghai Stock Exchange today. That values the company at up to 56 times 2008 earnings, it said.

Everbright Securities Co. raised a similar amount in August in China’s first initial public offering by a brokerage since 2002. The shares were priced at 21.08 yuan, 59 times last year’s earnings, and ended last week at 23.96. Companies included in the benchmark Shanghai Composite Index trade at an average 34 times, according to data compiled by Bloomberg.

The Shanghai Composite has jumped 74 percent this year, spurring demand for stock investments. Everbright’s net income more than doubled in the third quarter to 637 million yuan, with commissions from trading equities and mutual funds jumping to 1.2 billion yuan from 419 million yuan a year earlier.

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Last Updated: November 8, 2009 07:30 EST