CSR, Chinese Train Suppliers Surge on $600 Billion Rail Investment Report
China CNR Corp. and CSR Corp., the nation’s largest trainmakers, jumped in Shanghai trading after a report that the government is planning to spend as much as 4 trillion yuan ($600 billion) expanding rail networks.
CSR rose 7 percent to 7.69 yuan and China CNR surged 6 percent to 6.74 yuan. Builder China Railway Group Ltd. jumped 2.3 percent. The Shanghai Composite Index fell 1 percent.
China may make the rail investment as part of a five-year plan starting next year as it works to ease transport bottlenecks and spread economic development, the China Securities Journal said today, citing an unidentified person. The country also formed ventures with Alstom SA and Bombardier Inc. this week to help develop new rail systems.
“Rail suppliers are sure to benefit from the investment plans as it will boost demand for their products,” said Liang Futao, a research manager at Changjiang Pension Insurance Co. “Foreign companies will also benefit because China needs their advanced technology.”
Calls to Wang Yongping, a spokesman at the railway ministry in Beijing, went unanswered.
Jinxi Axle Co., a manufacturer of railroad axles, surged by the 10 percent limit. China Railway Erju Co., a railway construction company, climbed 3 percent.
In Hong Kong, CSR, which has a trainmaking venture with General Electric Co., rose 6.7 percent. China Railway Group climbed 2.8 percent.
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