Business / Markets

CRRC shares rise after 6-day plunge

( Updated: 2015-06-17 17:29

CRRC Corp, the train maker behemoth formed after the merger of China North Railway and China South Railway, rose on Wednesday after a six-day plunge.

The stock closed at 22.45 yuan, up 4 percent, after diving by a total of 26.7 percent over the past six days, which evaporated its market valuation by nearly 384 billion yuan ($61.9 billion).

The loss came after the CRRC surged by the daily limit of 10 percent on its first trading day at the Shanghai bourse on June 8. The CNR and the CSR had rallied staggering 3.65 and 4.08 times respectively since the merging announcement before suspended from trading.

The CRRC's H-share closed at HK$11.9 on Wednesday, up 7.8 percent.

However, the market momentum remained strong despite the price swing, as its outstanding balance of margin purchase rose for a sixth day to 9.3 billion yuan as of Tuesday.

According to the merger plan, the CRRC will focus on overseas industrial distribution and management.

Experts said that the merger will help the trainmakers become more competitive against rivals, including France-based Alstom SA, Canada-based Bombardier Inc and Germany-based Siemens AG.

According to CSR, nearly 20 countries, including the UK and Thailand, plan to build high-speed railways representing total investment exceeding $800 billion.

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