China Automation is the largest provider of safety and critical control systems

China Automation expects its railway signalling and petrochemical system businesses to continue growing at 40-50% and 20-30% per annum, respectively, on rising demand in the next few years. It expects to win a few contracts, with confidence in the contract for Beijing metro, which will be announced in 2H09.

China Automation is the largest provider of safety and critical control systems in China, specialising in the petrochemical and railway signalling industries. The company’s business development hinges on the fast-growing Chinese railway industry. It foresees rising penetration given growing consciousness for railway safety. Management expects the railway signalling business to continue growing at 40-50% per annum in the next few years. Management expects city metro to offer exciting growth opportunities. Contract sizes for metro-line stations of Rmb200-350 mn are much larger than those for nationwide railway projects. Over 30 cities are planning to construct 85 city metro lines. Management expects the company to win a few contracts, with confidence in the contract for Beijing metro, which will be announced in 2H09. As the demand for safety and critical control system from the petrochemical industry is increasing rapidly, China Automation expects its petrochemical system business to continue growing at 20-30% per annum in the next few years.

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