The shares rose as much as ¥80,000 (US$3,191.67), or 17 percent, to ¥0.57 million (US$23,097), their highest in almost a month. Some 25,000 shares traded in the morning session, surpassing the most recent six month full-day average.
DoCoMo said last week it plans to sell 460,000 new shares to raise as much as US$6.7 billion to fund investments in overseas carriers. DoCoMo spokesman Toru Hinata said those plans have not been changed.
The surge in DoCoMo's shares came as Japanese telecommunication stocks rallied across-the-board, with the Topix Communication index gaining 8.6 percent in the morning. Speculation the company would cut the size of the offering helped boost the shares, traders said.
"I would not be surprised if DoCoMo changes its plan" by selling fewer shares, said Joji Maki, a senior director at Baring Asset Management (Japan) Ltd, which manages ¥30 billion (US$4 billion) in Japanese equities.
As of yesterday, Tokyo-based DoCoMo's shares had lost almost half their value since the beginning of last year along with global peers as investors questioned telecommunications carriers' expansion plans. Analysts say DoCoMo also declined prior to saying it would issue new shares to raise cash for expansion.
"We see the Nasdaq and global telecom stocks recovering and among Japanese telecom stocks DoCoMo was the most sold down due to this secondary offering so it has most to gain," said Kirk Boodry a senior analyst at Dresdner Kleinwort Wasserstein. Boodry sent a note on DoCoMo this morning saying he expects the stock to rebound to ¥0.6 million (US$21,837) in the short-term.
Goldman, Sachs & Co, which is arranging the sale with Nikko Salomon Smith Barney, is the largest buyer of DoCoMo shares so far today, traders said. In the morning, Goldman bought 10,100 DoCoMo shares, according to data from the Tokyo Stock Exchange.
Officials at Goldman could not be reached for comment. Nikko Salomon Smith Barney declined to comment.
The shares ended the morning session at ¥0.47 million (US$20,745), a gain of 13 percent.
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