Shares in a few Hong Kong-listed companies from Sichuan and Chongqing, which had suspended trading on Tuesday following the mainland earthquake, recorded favorable increases upon resumed trading yesterday.

Investors were apparently confident in some companies' claims that the quake would have little effect on their performances.

Sichuan Expressway and Chongqing Iron & Steel are expected to benefit from rescue work and re-construction in the wake of the disaster, analysts said.

Shares in Sichuan Expressway, a road and infrastructure contractor in the province, climbed 11.48 percent to HK$2.72 yesterday.

And Chongqing Iron & Steel Company, a Sichuan-based iron- and steel-products manufacturer, increased as much as 18.21 percent to HK$3.83.

Both companies bucked the market trend, which saw the Hang Seng Index drop a meager 0.08 percent.

A Sichuan logistics group, Changan Mingsheng Logistic, also ended trading over 3 percent higher.

"It was the company's announcement, in which it indicated that operations would remain normal, that helped the share price jump," said Kingston Lin, an associate director at Prudential Brokerage.

The production plants of Chongqing Iron & Steel are all located in Chongqing and weren't affected by the earthquake, the company said in a statement to Hong Kong Exchanges and Clearing.

After a self-inspection, the company resumed normal production and operations, it said.

Sichuan Expressway also said in a statement that its major expressways are located in the eastern and southern parts of Sichuan, and that operations of the expressways haven't been affected by the earthquake.

"The board confirms that the business operations of the company and its subsidiaries will continue as usual," it said.

Growing demand

Many Hong Kong-listed construction-material providers saw their shares soar yesterday, boosted by the speculation that post-quake construction will generate huge demand for their products.

Lin expects Chongqing Iron & Steel, which is also an iron- and-steel distributor, to receive huge demand from post-quake construction.

"There must be many buildings that need to be re-built after the earthquake, and Chongqing Iron & Steel will be a major construction-material provider. And the highway operators will draw investors' attention as they become extremely important now," Lin said.

Anhui Conch, a cement producer, jumped over 3 percent yesterday, and China Aluminum, the country's largest aluminum maker, increased 2.57 percent.

Demand may greatly increase in the coming months. However, not all construction-material providers will benefit, said Tony Tong, an analyst at China Everbright Research Ltd.

"Builders will most likely use the materials provided by local companies, and some of them may not be Hong Kong-listed," he said. "It's very expensive to transfer cement all the way from Anhui to Sichuan.

"Besides, the extent of the damage is not yet known."

Worries remain

Hong Kong-listed Neo-China, a property developer with development projects in Chongqing and Chengdu, hasn't yet resumed its trading.

The developer said the earthquake has caused some damage and disruption to projects in those areas.

The company has suspended development on certain projects for several days, including in Chongqing, where repairs could take 10 days, the firm said in a statement.

(HK Edition 05/15/2008 page2)