A Sino-Pakistani joint venture tire manufacturer has debuted on the Pakistan Stock Exchange (PSX) in a move market participants described as the first listing by a Chinese-invested company on the country’s bourse and a milestone in the deepening integration of industrial and financial cooperation between the two nations.
Service Long March Tyres Ltd — a JV between Pakistan’s Servis Group and China’s Chaoyang Long March Tyre Co Ltd — was listed on the PSX on Monday. Chinese shareholders held about 43 percent of the company before the offering.
Shares of SLM opened at 21.95 Pakistani rupees ($0.079) on Monday, up 10.03 percent from its issue price of 19.95 rupees, and remained at the upper limit of the day’s trading band during early trading, the PSX website said, pointing to strong investor demand following the heavily oversubscribed offering.
The initial public offering raised 7.77 billion Pakistani rupees, making it the largest private-sector IPO in Pakistan’s capital market history. The book-building process attracted bids worth 69.4 billion rupees, representing an oversubscription of 16.7 times and setting records for both subscription amount and subscription speed on the exchange.
The listing comes as capital market cooperation is increasingly complementing trade, infrastructure and industrial links under the China-Pakistan Economic Corridor.
You Hang, executive vice-president of China Financial Futures Exchange and Chinese shareholder director of the PSX, said SLM’s successful debut reflects the combined impact of industrial cooperation, technology transfer and capital market support between China and Pakistan.
In 2017, a Chinese-led consortium that included the China Financial Futures Exchange, the Shanghai Stock Exchange and the Shenzhen Stock Exchange acquired a strategic stake in the PSX, helping improve its corporate governance and strengthen cooperation between the two countries’ financial markets.
Proceeds from the IPO will mainly be used to finance construction of a new passenger-car radial tire plant in Pakistan. The project — with a planned investment of about 22.56 billion rupees — is expected to begin operations in 2028 and further improve the tire industry chain in Pakistan.
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