HONG KONG: Shares in MTR Corp, Hong Kong's subway operator, rose to a record after the company's first-half profit more than doubled on increased fare revenue and higher valuation for its real estate holdings.
The stock rose as much as 1.5% to HK$16.60, its highest since trading began in October 2000.
MTR's first-half net income rose to HK$2.61bil (US$335.8mil) from HK$1.17bil last year, the company said on Tuesday after the market closed. A rebound in Hong Kong's economy helped MTR increase fare revenue by 4%, and raised the value of its real estate holdings.
MTR should be able to maintain growth in fare revenue in the second half as the economy continues to improve,'' said Louis Wong, who does not own MTR stock in the US$25mil he helps manage at Phillip Asset Management Ltd here. The government has said Hong Kong's economy will grow as much 5.5% this year.
MTR's rail business would also benefit from Walt Disney Co's plan to open a Hong Kong theme park, finance director Lincoln Leong told reporters yesterday.
Government-controlled MTR subsidises its seven rail lines in the city with income from real estate projects above train stations. Profit from property development rose 32% in the first half to HK$1.52bil. Bloomberg