S.Korea's Doosan Bobcat soars on debut as Trump boosts outlook (updated)

Doosan Bobcat

18/11/2016 01:00

* Trump's election pledges seen benefiting firm-analysts 
    * U.S. housing market outlook positive for Bobcat 
    * Nth America makes up most of firm's operating profit 
 
 (Adds analyst comment, U.S. housing market background) 
    By Joyce Lee 
    SEOUL, Nov 18 (Reuters) - Shares in South Korea's Doosan 
Bobcat Inc  241560.KS  jumped 20 percent from its initial public 
offering price on debut on Friday, as investors bet the 
U.S.-focused construction equipment maker will benefit from 
Donald Trump's presidency. 
    Comparatively low U.S. housing inventory combined with 
Trump's promises of corporate tax cuts and infrastructure 
spending bode well for Doosan Bobcat, which has the largest 
market share in North America for small construction equipment 
such as skid-steer loaders, analysts said.  
    Doosan Bobcat opened at 36,000 won per share compared with 
the IPO pricing of 30,000 won. It rose to 36,100 won as of 0058 
GMT, while the wider market  .KS11  was down 0.5 percent.  
    The listing, which was South Korea's second-largest this 
year, raised about $790 million after Doosan Bobcat slashed its 
original target.  urn:newsml:reuters.com:*:nL4N1D70JS 
    With North America making up the majority of Doosan Bobcat's 
operating profit, analysts said Trump's victory in the U.S. 
election could hurt some of the company's main competitors if 
the Republican president-elect raises tariff walls.  
    "The pledge to raise tariffs could lead to increased product 
costs for rival Kubota  6326.T  which is No.3 in U.S. market 
share," said John Yu, analyst at NH Investment & Securities. 
"Expansion in infrastructure investment would be a bonus."  
    The construction of U.S. single-family housing surged and 
building permits jumped in September, suggesting overall 
residential construction may rise again in the fourth quarter. 
 urn:newsml:reuters.com:*:nL1N1CP0JE 
 
 (Reporting by Joyce Lee; Editing by Stephen Coates) 
 ((jungyoon.lee@thomsonreuters.com; +82 2 3704 5609; Reuters 
Messaging: jungyoon.lee.thomsonreuters.com@reuters.net)) 
 
Keywords: DOOSAN BOBCAT IPO/