China State Construction Engineering Corp, in the world's largest initial public offering in more than a year, said yesterday it planned to raise as much as Rmb50.2bn ($7.3bn) on the back of China's economic stimulus policies.

China's largest housing contractor will sell as many as 12bn shares at Rmb3.96 to Rmb4.18 each, according to a filing to the Shanghai stock exchange.

By setting a higher IPO price than expected, China State Construction dealt a blow to the Shanghai market. The benchmark Shanghai composite index registered its biggest one-day drop in five weeks as subscriptions were taken for the massive public offering. China State Construction's IPO is many times larger than any other offering approved since China's securities regulators lifted an unofficial moratorium on IPOs imposed last September.