Shares in China National Nuclear Power Co., the country’s second-biggest operator of atomic plants, surged by the limit today in their Shanghai trading debut, bolstered by the country’s plans to boost nuclear power generation and reduce dependence on coal.
The shares were suspended right after trading started at 9:30 a.m. local time when they rose by the 44 percent daily limit to 4.88 yuan from 3.39 yuan. The city’s benchmark Shanghai Composite Index dropped 0.5 percent as of 12:10 p.m. The unit of state-owned China National Nuclear Corp. raised 13.2 billion yuan ($2.1 billion) in Shanghai’s biggest initial public offering since 2011.
CNNPC follows its larger rival CGN Power Co. onto a stock exchange. CGN listed in Hong Kong in December and has gained 76 percent since. CNNPC plans to use the proceeds to build 10 reactors and for working capital, according to its statement on April 30.
CNNPC has a “distinct advantage” in the domestic power market and has strong earnings growth potential, Guotai Junan Securities Ltd. said in a research note before trading started.
Asia represents the future for nuclear energy, as the region has 47 reactors under construction, most of them in China, and a further 142 forecast by 2030, the World Nuclear Association said in January. Asian investment in nuclear projects could reach $781 billion during the period, the WNA said. China has 22 reactors in operation and another 26 being built.