June 17 (Bloomberg) -- Coca-Cola Co.,General Electric Co.Wal-Mart Stores Inc. are among U.S. companies that may seek to list on China’s stock exchanges, UBS AG said.

John Tang, a Hong Kong-based UBS strategist, said he expects a dozen Western companies with a “strong presence” in China to offer shares in the yuan-denominated A-share market.

“An A-share IPO allows foreign companies direct access to much needed renminbi funding,” Tang wrote in a note to clients. UBS declined a request for an interview.

The U.S. companies would benefit from higher valuations in China’s stock exchanges, he said. The Shanghai Composite Index has rallied 52 percent this year, boosted by increased lending and prospects for a recovery in Asia’s biggest economy. The index trades at 28 times reported profit, twice the price-to- earnings ratio of the Standard and Poor’s 500 Index.

China would gain by expanding choices for mainland investors, improving corporate governance and helping the exchanges become more “internationally oriented,” Tang wrote.

Besides Hong Kong-listed stocks and mainland companies, the Chinese government may allow Western companies in the consumer and manufacturing industries to offer shares, Tang said.

“Coca-Cola is not willing to speculate,” Kerry Kerr, a spokeswoman for the Atlanta-based beverage maker, said in a phone interview. GE doesn’t have “any current plans to announce” regarding a listing in China, said Anna Eisele, a Fairfield, Connecticut-based spokeswoman for the company.

Interest Lacking

A phone message and e-mail left for John Simley, a spokesman for Bentonville, Arkansas-based Wal-Mart, weren’t returned. Xia Lihua, a Beijing-based spokeswoman for the China Securities Regulatory Commission, didn’t immediately respond to a faxed request for comment.

Donald Straszheim, a former Merrill Lynch & Co. chief economist who runs Los Angeles-based Straszheim Global Advisors, said U.S. companies may not be interested in listing in China.

“China still does not have a sufficiently robust history of equity market stability either in terms of performance or in terms of rules and regulations,” he said in a phone interview. “Until that is the case I can’t see any significant foreign company doing IPOs in China.”

China’s government has said as early as November 2001 that it may allow foreign companies to list on its domestic bourses. HSBC Holdings Plc Chief Executive Officer Michael Geoghegan said last month the bank looks forward to listing its shares in Shanghai when local rules permit. NYSE Euronext, the world’s largest owner of stock exchanges, has the Chinese government’s support for listing in Shanghai, Chief Executive Duncan Niederauer said May 15.

Share Sale Suspension

Everbright Securities Co., Zunyi Titanium Co. and Sichuan Expressway Co. may be among the first domestic companies to sell shares publicly in China as the government prepares to reopen what was the world’s second-largest equity fundraising market in 2007. The companies are working on final documents required for regulatory approval to offer stock in Shanghai or Shenzhen, three people with knowledge of the matter said.

China’s government stopped allowing IPOs and secondary sales in September as it sought to stem a 55 percent plunge in the benchmark equity index in the first eight months of the year.

To contact the reporters on this story: Allen Wan in New York at awan3@bloomberg.net; Veronica Espinosa in New York at vespinosa@bloomberg.net

Last Updated: June 16, 2009 22:41 EDT