(Yicai Global) Jan. 24 -- China Mobile’s shares rose after the world’s biggest telecoms carrier said its parent company plans to invest as much as CNY5 billion (USD790 million) increasing its stake in the firm’s Shanghai-listed stock.

China Mobile [SHA: 600941] edged up 1.1 percent in Shanghai to close at CNY58.19 (USD9.19) today, after climbing as much as 2 percent in the afternoon. Its Hong Kong-traded stock [HKG: 0941] climbed 2 percent to HKD52.30 (USD6.72).

China Mobile Communications Group aims to spend CNY3 billion to CNY5 billion to buy more of China Mobile’s Shanghai equity this year, the Beijing-based carrier said yesterday, without disclosing the purchase price.

The parent already spent CNY710 million (USD112 million) on Jan. 21 buying 12.3 million of the shares, equal to 1.5 percent of the Shanghai-traded stock and 0.06 percent of China Mobile’s total. After the purchase, it owned a 69.9 percent stake.

China Mobile Communications is confident about the telecom operator’s future development and recognizes its long-term investment value, it added.

China Mobile’s debut on the Shanghai Stock Exchange on Jan. 5 was the largest mainland share offering in about a decade, raising CNY48.7 billion (USD7.6 billion).

It also had a so-called green shoe option, allowing underwriters to buy up to 15 percent of the shares within 30 days of the listing to stabilize the stock price if it fell below the issue price. If the option is used, China Mobile would bank CNY56 billion, surpassing the CNY54 billion that smaller rival China Telecom raised last August. 

On the second trading day, when the shares were hovering around the issue price, about one million lots were purchased at CNY57.58, worth a total of CNY6 billion. Industry insiders speculated that China Mobile launched the over-allotment option.

Editor: Futura Costaglione