Sichuan Road and Bridge (600039.SH): Abandoned holdings and investment in the Jinkouhe-Xichang and Zhaojue-Puge Expressway projects

Zhitongcaijing · 10/25 13:17

Zhitong Finance App News, Sichuan Road and Bridge (600039.SH) announced that the company's subsidiaries Sichuan Highway and Bridge Construction Group Co., Ltd. (“Road and Bridge Group”), Sichuan Transportation Construction Group Co., Ltd. (“Sichuan Construction Group”), Sichuan Road Aviation Construction Engineering Co., Ltd. (“Road Transport Company”), and Sichuan Luqiao Shengtong Construction Engineering Co., Ltd. (“Shengtong Company”) intend to relinquish their holdings with the company's affiliates Sichuan Expressway Construction and Development Group Co., Ltd. (“Chuangao Company”), Sichuan Gaolu Information Technology Co., Ltd. (“Gaolu Information”) formed a consortium to participate in the investment of the Jinkouhe-Xichang and Zhaojue-Puge Expressway projects.

According to the announcement, the total investment of the project is 67.323 billion yuan, and the self-funded capital ratio of the project is 20.20%, or about 13.599 billion yuan. The total shareholding ratio of the company is 2.3%, of which Luqiao Group, Jiaotong Construction Group, Sichuan Jiaotong Company, Road Aviation Company and Shengtong Company held 1.2%, 0.1%, 0.2%, and 0.1% of the shares respectively, with a total investment of about 313 million yuan in project capital.

According to reports, the investment amount of the project is large, and the demand for capital is high. For example, if the company invests independently, the capital requirement is about 13.599 billion yuan (accounting for 20.20% of the total investment); if the company has a holding investment (50%), the capital required at least about 6.8 billion yuan. Judging from the capital investment that the company will need to invest in the next three years, if the company holds (wholly-owned) investments in this project, there will be a certain amount of financial pressure.