CHINA Coal Energy Co, the nation's second-biggest coal producer, is seeking as much as 25.67 billion yuan (US$3.5 billion) from a Shanghai share sale, according to two insiders.

The firm will sell as many as 1.53 billion shares, an 11.5 percent stake, at 16 yuan to 16.83 yuan each, the people, who declined to be identified before an official statement, told Bloomberg News.

China Coal is the first Chinese company to set a range for a domestic public share offering of more than US$1 billion since the nation's benchmark stock index completed its steepest two-day drop on record on Tuesday.

The sale may serve as a bellwether for other large stock offerings in coming weeks.

Changsheng China Property Co, a Chinese builder partly owned by Goldman Sachs Group Inc, on Tuesday shelved a Hong Kong initial public offering to raise as much as HK$1.13 billion (US$144.7 million) after the city's Hang Seng Index had the biggest two-day drop in a decade.

The slump in mainland and HK stocks was triggered by concern of an economic slowdown in the US eroding demand for Chinese exports.

An emergency interest rate cut in the US on Tuesday helped China's CSI 300 Index rebound 4.7 percent yesterday, while the Hang Sang Index bounced back by 11 percent, the sharpest gain in a decade.

The high end of the range for China Coal's latest share sale, its first in Shanghai, puts it on par with the HK$18.16 closing price of its Hong Kong shares. The stock, which declined a record 17 percent in Hong Kong trading on Tuesday, had an average price of HK$22.30 in the past month, according to data compiled by Bloomberg News.

The Hong Kong-traded stock has fallen 26 percent this year, compared with the 13 percent decline in the Hang Seng Index.

China International Capital Corp and China Galaxy Securities Co are arranging China Coal's Shanghai share sale.