Ouhua Energy Holdings Ltd, China's third-largest liquefied petroleum gas (LPG) distributor, plans to list on the Singapore Exchange.

The company plans to sell new and vendor shares according to its prospectus for the issue.

The company is looking to sell at least 25 percent of its enlarged capital, raising as much as 40 million Singapore dollars (25 million U.S. dollars).

Ouhua Energy, based in Chaozhou, Guangdong Province, said proceeds from the share sale would be used to expand its sales network and improve production facilities.

Ouhua Energy embarked on a production capacity expansion programme in 2006, to raise annual designed capacity from 600,000 tonnes to 900,000 tonnes.

Ouhua Energy earned a net profit of 79.2 million yuan (9.9 million dollars) in 2005.

In the first five months of 2006, net profit grew 27.7 percent to 34.7 million yuan (4.3 million dollars).

Based on a probable price to earnings ratio of 8 to 10, the firm could have an indicative market cap of about 100 million dollars before the pre-IPO capital increase.

Over the past 10 years, global consumption of LPG has grown annually by about 3.1 percent, with the fastest-growing region being Asia.

China, the world's third-largest LPG consumer after the United States and Japan, produced 16.1 million tons in the year 2005, a year-on-year increase of 7.62 percent.

Currently Sinopec supplies 32 percent of domestic LPG consumption, with 31 percent coming from PetroChina and local firms, and the remaining 37 percent imported.

According to industry forecasts, domestic demand for LPG is expected to reach 28 million tons by 2010.

Founded in 2005, Ouhua Energy is principally engaged in the import, production, storage, and sale of LPG in southern and eastern parts of the country.

Its business range covers an area including Guangdong, Fujian, Hainan, Jiangxi, Zhejiang.

Source:佚名