China Shenhua shares up 20pc after special dividend

HONG KONG: China Shenhua Energy Co, the biggest coal miner in the world’s largest producer, surged the most since 2008 after rewarding investors with a special dividend as it posted its first profit growth in four years.

Shares gained more than 20 per cent to HK$19.78 (RM11.27), gaining most since October 2008, and were trading at HK$19.08 as of 2.30pm local time.

The company proposed a final dividend of 0.46 yuan (29 sen) per share for last year, as well as a special dividend of 2.51 yuan per share, it said in a statement late Friday.

“The scale of the special payout was startling and could be a bellwether for China’s state-owned enterprises,” Laban Yu, head of Asia oil and gas equity research at Jefferies Group LLC in Hong Kong, wrote in a note to clients yesterday.

“We believe initial market reaction would be overwhelmingly positive, although this does signal a lack of investment opportunity in China’s coal industry.”

Net income rose 41 per cent to 24.9 billion yuan last year, said the Beijing-based company in a separate filing to the Hong Kong stock exchange on Friday.

Shenhua, which also owns power plants and railroads, flagged the profit increase in January. Revenue expanded 3.4 per cent to 183 billion yuan, with about half from coal and more than onethird from power. Bloomberg

BLOOMBERG PIC Profit margins at the Agricultural Bank of China likely fell to 2.27 per cent last year, the lowest since at least 2008 and down from 2.66 per cent a year ago.