February 26, 2009 / 1:01 AM / 11 years ago

China Railway wins $3.3 bln contracts as gov boosts spending

SHANGHAI, Feb 26 (Reuters) - China Railway Group Ltd (0390.HK)(601390.SS), the country’s biggest railway and highway builder, said on Thursday it had won contracts worth 22.62 billion yuan ($3.3 billion).

The award is among the biggest since the government unveiled a 4 trillion yuan ($585 billion) stimulus package, focused on infrastructure and social welfare, to prevent an abrupt economic slowdown amid a deepening global recession.

The combined value of the four contracts is equivalent to 12.53 percent of 2007 revenue, China Railway said in a statement filed with the Shanghai Stock Exchange.

China Railway won contracts to build railways between southern Guangzhou and southeastern Nanjing, between eastern Hangzhou and Ningbo cities, and between western Lanzhou and Chongqing. It also won a contract to build a tunnel in southern Guangdong province.

In January, China Railway said its 2008 net profit is estimated to drop more than 50 percent due to an exchange loss on the firm’s Hong Kong listing proceeds, which were deposited overseas in foreign currencies. (USD$1= 6.8373 Yuan) (Reporting by Samuel Shen; Editing by Ken Wills)

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