Adds background, details, cornerstone investors and proceeds usage in paragraphs 2-3 and 8-9, Hong Kong IPO market performance in paragraphs 5-6

By Yantoultra Ngui

SINGAPORE, Oct 28 (Reuters) - Sany Heavy Industry 6031.HK shares rose as much as 4.7% in their Hong Kong debut on Tuesday after the Chinese construction machinery maker raised HK$12.36 billion ($1.59 billion) in one of the city's biggest listings this year.

Founded in 1994 as part of Sany Group, the company is now China's largest construction machinery manufacturer and among the top three globally, according to its prospectus.

Sany - which makes excavators, concrete machinery, cranes and road construction equipment, among others - operates 16 international production bases and sells in more than 150 countries.

Its stock opened flat at HK$21.30, matching the offer price, before rising as much as 4.7% to HK$22.30. It later trimmed those gains to trade slightly higher at HK$21.84, while the benchmark Hang Seng Index .HSI was little changed.

Sany's Hong Kong listing adds to a list of sizable share offerings in recent weeks, including the $3.2 billion initial public offering of Zijin Gold International 2259.HK - the largest such deal globally so far.

Companies have raised a total of $23 billion in Hong Kong in the first nine months of this year, more than three times the amount for the same period in 2024, Dealogic data showed.

Sany's Shanghai-listed shares 600031.SS were down 1.9% at 22.11 yuan. The stock has gained about 34% so far this year amid strong demand and overseas growth, giving the company a market value of about $26.8 billion.

Cornerstone investors in the Hong Kong offering included Hillhouse, BlackRock, Temasek via Aranda Investments, Infore Capital and China Life Insurance Group, according to the company prospectus.

Sany said it would use the proceeds to fund overseas expansion, invest in research and development for intelligent and electric machinery, repay debt and for general working capital.

($1 = 7.7675 Hong Kong dollars)

(Reporting by Yantoultra Ngui; Editing by Nivedita Bhattacharjee and Subhranshu Sahu)

((Yantoultra.Ngui@thomsonreuters.com;))