*

Zijin Gold to offer shares in IPO at HK$71.59 apiece

*

Cornerstone investors have subscribed to about half of

shares

*

Company's IPO in Hong Kong comes as gold price gains

*

Zijin Gold will list on Hong Kong bourse on September 29

(Recasts and writes through with analyst comment, IPO details)

By Kane Wu and Scott Murdoch

Sept 19 (Reuters) - China's Zijin Gold International,

keen to make the most of bullish sentiment for the precious

metal, is aiming to raise $3.2 billion in a Hong Kong IPO that

is set to be the city's largest in four years.

Adding to a strong recovery for Hong Kong's equity capital

market, the offering could garner as much as HK$28.7 billion

($3.7 billion) at a valuation of $24.6 billion if an

overallotment of shares is fully exercised.

Gold, which tends to perform well during periods of

uncertainty and in low-interest rate environments, has gained

nearly 39% so far this year.

"A $24 billion market cap for Zijin Gold is reasonable,"

said David Blennerhassett, a strategist of Ballingal Investment

Advisors, who publishes on SmartKarma, in a Friday research

note.

"This is a total bull market for gold plays. Momentum is

strong. You have long-only support," he said.

Zijin Gold, a wholly owned unit of China's Zijin Mining

that operates all of the group's gold mines outside

China, is selling 349 million shares at HK$71.59 apiece, its

prospectus showed on Friday.

Trading is set to commence September 29.

It would be the largest IPO in Hong Kong since JD Logistics' ( JDLGF )

May 2021 float which raised $3.6 billion, Dealogic

data showed. If the overallotment is exercised it would be the

largest since Kuaishou Technology ( KUASF ) raised $6.2 billion

in January 2021.

Its offering follows one from automaker Chery this week that

aims to raise up to $1.2 billion.

Hong Kong has seen total funds raised from new listings

reach $18.5 billion so far this year, exceeding 2024's full-year

figure of $11.3 billion, Dealogic data showed. Booming demand

for Chinese AI and tech stocks has seen a raft of Chinese

companies listed in the mainland also sell shares in Hong Kong.

Zijin Gold said in the prospectus that it is planning to use

the proceeds over the next five years to upgrade existing mines.

It added that it expects global gold demand to grow steadily

at a compound annual growth rate of 3.2% from 2024 to 2030.

Cornerstone investors have subscribed to about $1.6 billion

worth of shares, according to the prospectus.

Singapore wealth fund GIC and private equity firm

Hillhouse will each buy $150 million worth of shares while asset

managers BlackRock ( BLK ) and Schroders ( SHNWF ) will each take

$120 million worth.

A wholly owned unit of industry peer Zhaojin Mining

has also subscribed to $30 million worth of shares.

Morgan Stanley and CITIC Securities are the joint sponsors

of the offering.

Zijin Mining's shares in Shenzhen rose 0.8% while its shares

in Hong Kong rose 0.5% in Friday afternoon trade.

($1 = 7.7771 Hong Kong dollars)