SPRING Airlines Co., China’s largest budget carrier, yesterday rose by the exchange-imposed limit on the Shanghai bourse after staging the first initial public offering (IPO) of a Chinese airline since 2002 to help meet surging demand in Asia’s largest economy.

    The shares opened at 26.15 yuan, 44 percent higher than the 18.16 yuan price in the IPO. The offering of A shares raised 1.8 billion yuan (US$290 million).

    Spring Airlines plans to buy new aircraft as rising incomes drive up demand for air travel across Asia. The firm, founded in 2005 by president Wang Zhenghua, is also bracing for more domestic competition after China’s civil aviation administration said last year it would loosen regulations and study tax breaks to encourage more budget carriers in the country.

    Spring Airlines has undercut rivals through cost-cutting and creativity. When it was restricted to unprofitable early-morning or late-night landing slots at Beijing’s main airport, it shifted flights to Shijiazhuang, a small airport about 300 kilometers away, and gave passengers free high-speed rail tickets to get them into the capital in an hour. It has since used a similar strategy to carry passengers to Tokyo and Osaka in Japan.

    Such workarounds have helped Spring Airlines outperform rivals such as China Eastern Airlines and its subsidiary Shanghai Airlines. Spring Airlines reported an average load factor of 95 percent last year — the highest among Chinese carriers — and has been profitable since its first full year of operation in 2006.

    “It’s never an easy ride for us. There are always challenges and difficulties,” said Zhang Wuan, Spring’s marketing chief. “We just never take ‘no’ for an answer.”

    Shijiazhuang is now Spring Airline’s major northern China hub, with flights to 14 domestic and three overseas destinations.

    In 2013, Spring Airlines reported a 17 percent rise in net profit to 732.2 million yuan, its prospectus shows. (SD-Agencies)