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Beijing-Shanghai high-speed rail operator prepares for IPO

02/28/2019| 10:47:19 AM|

The company was founded in 2008, with China Railway Investment - fully owned by CRC - holding a 46.21% stake.

China Railway Corp (CRC) said on Tuesday that its lucrative subsidiary Beijing-Shanghai High-Speed Railway Co is preparing for an IPO on the A-share market, part of the company's push for market reforms.

The move, also another important step in the mixed-ownership reform of Chinese state-owned enterprises, could bring both opportunities for the state-owned company as well as challenges in navigating through complex reforms required for listing, analysts said.

The company was founded in 2008, with China Railway Investment - fully owned by CRC - holding a 46.21% stake, data on research platform tianyancha.com showed.

In the short term, listing the Beijing-Shanghai high-speed line can help CRC raise funds to repay debt, Zhao Jian, a professor at Beijing Jiaotong University, told the Global Times on Wednesday. The state-owned CRC reportedly has fast-accumulating liabilities.

But going public will be a challenge, pushing the company to operate with more transparency, Zhao said.

Beijing-Shanghai High-Speed Railway is a cash cow. After breaking even in 2014, the corporation had generated 31.17 billion yuan ($4.66 billion) in profits by 2017, National Business Daily reported in July 2018. 

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TAGS: CRC | railway | IPO
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