Death raises concerns over railway firm's debt
The sudden death of China Railway Group's president has triggered investor concerns over the heavy debt burden of the nation's railway builders, which analysts say will be hard to shake off in the near term.
The sudden death of China Railway Group's president has triggered investor concerns over the heavy debt burden of the nation's railway builders, which analysts say will be hard to shake off in the near term.
Shares in China Railway Group, a dual-listed state-owned engineering giant, fell up to 7 per cent in Hong Kong and up to 5 per cent in Shanghai yesterday after the company said its president, Bai Zhongren, died of "an accident" over the weekend.
The 53-year-old executive was reported to have been suffering from depression and jumped to his death on Saturday, according to mainland media.
The company's stock closed at HK$3.75 in Hong Kong, down 4.1 per cent, while the A share fell 4.2 per cent to 2.51 yuan (HK$3.18).
"The market overreacted," said Gary Wong, analyst at Guotai Junan analyst.
He said the stock plunge reflected investors' concerns on both the debt problem in the railway industry and Beijing's green light to restart initial public offerings.