As international gold prices hit a record high and keep rising, China's gold developer Zijin Gold is launching an initial public offering (IPO), jumping on the "gold-price rally." The corporation plans to raise more than 4 trillion won in total. Among Chinese corporations, it is the largest since the battery company CATL, and it is drawing market attention as BlackRock, the world's largest investment firm, and Singapore's sovereign wealth fund (GIC), one of the world's three major sovereign wealth funds, are taking part in the IPO.
Bloomberg reported on the 19th (local time) that Zijin Gold will raise about $3.2 billion (about 4.4432 trillion won) through a Hong Kong listing. According to listing documents obtained by Bloomberg, the company will issue about 349 million shares at 71.59 Hong Kong dollars (12,807 won) per share. The offering starts on the 29th, led by Morgan Stanley and CSC Financial.
According to Chinese financial media Zhitong Caijing, Singapore's sovereign wealth fund (GIC), Hillhouse Investment (Gaoling Investment), and global hedge fund Millennium Management, as well as BlackRock, Fidelity International, and Baillie Gifford, will participate in the IPO and be allocated about half of the total shares.
This IPO is expected to be the largest globally since May. Among Chinese corporations, it is the biggest since the $5 billion (about 6.9585 trillion won) IPO by CATL, China's largest battery maker. The company plans to use part of the proceeds to pay for the acquisition of a Kazakh gold mine and to upgrade existing mines and build new ones over the next five years.
According to the China Securities Journal, Zijin Gold is one of the world's largest gold producers, engaged in global gold exploration, mining, extraction, smelting, refining, and sales. It is a subsidiary of the state-owned gold miner Zijin Mining. To internationalize its gold division, Zijin Mining reorganized its overseas gold assets into Zijin Gold and pursued a spin-off listing through partitioning.
Zijin Gold owns eight gold mines in gold-rich regions such as Central Asia, South America, Oceania, and Africa, seven of which it operates directly, while it holds only equity in one. As of the end of 2024, the company ranked ninth in the world in gold reserves and 11th in gold production. Bloomberg Intelligence said, "Zijin Gold has a track record of securing promising mines at low cost, and its production growth is faster than major competitors."
In fact, from 2022 to 2024, Zijin Gold's compound annual growth rate (CAGR) in gold production was 21.4%. In 2024, return on assets (ROA) reached 21.4%, and the average all-in sustaining cost (AISC) was $1,458 per ounce, the sixth lowest among the world's top 15 gold miners.
Meanwhile, gold prices have more than doubled over the past three years and continue to soar. This week they broke $3,700 per ounce (about 5.15 million won), setting a new all-time high, and some note that gold could rise further on increased preference for safe assets driven by Central Bank purchases and threats to the independence of the U.S. Federal Reserve (Fed). According to Zhitong Caijing, thanks to rising gold prices, Zijin Gold's gold revenue in 2024 rose 29.8% year over year to $2.81 billion.