Rongsheng Among 51 Shipyards Listed for Policy SupportClement Tan
A Jiangsu shipyard belonging to a unit of China Rongsheng Heavy Industries Group Holdings Ltd. was listed among 51 shipbuilding facilities deemed worthy of policy support as the industry grapples with overcapacity.
The list issued by China’s Ministry of Industry and Information Technology also includes shipyards belonging to China Shipbuilding Industry Corp., China Ocean Shipping Group, China Sinotrans Group, Yangzijiang Shipbuilding Holdings Ltd. among others.
China is pressing to overhaul the sector by encouraging private investment in state-owned shipping companies as well as promoting mixed-ownership. The country became the world’s biggest center for building ships after the global financial crisis spurred looser credit and hundreds of private shipyards opened to compete for orders.
The MIIT list, released Sept. 3, may be a boon for Rongsheng, which reported a fourth straight half-yearly loss in the six months that ended June. Rongsheng’s shares, up 12.4 percent since the start of the year, were suspended in Hong Kong on Aug. 29 pending an announcement on an imminent restructuring.
China CSSC Holdings Ltd. jumped 10 percent to 28.73 yuan in Shanghai trading after 15 shipyards under its majority shareholder China State Shipbuilding Corp. were included in the list. China Shipbuilding Co. climbed 8 percent to 5.82 yuan. With a number of the selected shipyards in Jiangsu, Zhejiang province and Shanghai city, Shanghai International Port Group Ltd. advanced by the daily-limit 10 percent to 5.30 yuan. Ningbo Port Ltd. also surged 10 percent to 2.82 yuan.
Last year, the government issued a three-year plan last year urging financial institutions to support the shipbuilding industry.