SHARES in China’s largest nuclear power producer, CGN Power Co., surged 24.1 percent in their Hong Kong trading debut yesterday as investors bet on a government-backed sector primed for growth.

    CGN Power raised about US$3.2 billion after pricing the deal at the top of a HK$2.43 (US$0.31) to HK$2.78 per share marketing range.

    CGN Power plans to use the proceeds of the IPO mostly to expand installed capacity with nine new power generating units and to buy a stake in a nuclear power plant from its parent company.

    Energy-hungry China aims to increase its reliance on nuclear energy to bring its spiralling greenhouse emissions under control by 2030. Experts have said that nuclear power is the only scalable replacement energy in China’s strategy.

    CGN Power said it expected China’s installed capacity for nuclear power to surge to 128 gigawatts (GW) by 2030 from 16 GW in 2013. The company sees its own output more than doubling to 24,970 megawatts (MW) by 2019 from 11,624 MW in 2014.

    The retail portion of the IPO was hugely over-subscribed, triggering a so-called claw-back rule that forced underwriters to reallocate shares from institutional investors to individuals, CGN Power said in a filing Tuesday. The institutional tranche of the deal was “very substantially over-subscribed,” the company added.

    ABC International, Bank of America Merrill Lynch and China International Capital Corp. (CICC) were hired as sponsors of the IPO and will earn a combined US$3 million for their role.(SD-Agencies)