FAST NEWS: Lingbao Gold basks in glittery spotlight with new share sale

The Latest: Lingbao Gold Group Co. Ltd. (3330.HK) sold nearly 26.92 million new shares on Wednesday for HK$3.02 a piece, a 16% discount to the previous day’s close, raising HK$79.3 million ($10.1 million) in net proceeds.

Looking up:  The company will be able to use the new funds to procure more gold concentrate to produce gold bullion. 

Take Note:  Lingbao sold 32.54 million new shares in February for HK$1.34 per share, a 20% discount to its share price at that time, meaning it has raised funds for the second time in just two months.

Digging Deeper:  Lingbao Gold was established in 2002 and listed in Hong Kong in 2006. Its main business is gold mining, smelting and sales. The price of gold rose from last year, reaching more than $2,000 per ounce due to the Israeli-Palestinian conflict, which benefited Lingbao Gold and other producers. The company’s profit rose 30% last year to 318 million yuan ($44 million), and its gross profit margin increased by 1.5 percentage points year-on-year to 9.2%. 

Market Reaction: Lingbao’s stock opened lower on Thursday, but pared some of the losses to close down 2.5% at HK$3.51 by the midday break. The stock still trades at the higher end of its 52-week range.

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