Wednesday, October 17, 2007

PetroChina 12% Away from being the Largest Company in the World

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This move in PetroChina is amazing!!! Yet I read very little about it. The stock is up 50% in 5 sessions. This is not a small cap people, it is now worth over $470 BILLION. Exxon is worth $525 BILLION. PetroChina tacked on another 14% today. If it "simply" puts on 12% tomorrow it would be the biggest company in the world.

For earlier posts on PetroChina, including my prediction that the Shanghai IPO could cause this stock to run (but I never imagined to these heights) click here.

I wrote on September 19th

PetroChina (PTR) has plans to list on the Shanghai exchange ("A" bubble shares) so its very positive once that happens the Hong Kong (and by inference the US ADR shares) will see a spike. While nonsensical - it's still a strong possibility, since Chinese investors apparently value everything on the Shanghai exchange at a 50-70% premium to what the rest of the world values an asset. If such a move happened PetroChina (PTR) would be approaching a value that would place it either as the most highly valued company in the world, or in the top few - fairly or unfairly. This is what a reverse exchange listing (going from Hong Kong to Shanghai) can do for a company it appears.

Again, I was being a bit facetious - I did not fully expect a simple listing to vault this company to #2 in the world and potentially #1 tomorrow. The stock has added nearly $160 BILLION in paper value in 5 days. That is almost the value of Google (GOOG) created in a week.

Unbelievable.

Bespoke shows that 7 of the largest 25 companies in the world, by paper value, are now Chinese, including 3 of the top 5. And that was Monday, before today's huge run in mega cap Chinese stocks.

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