Since 2016, PPP projects in the field of rail transit have been continuously implemented. Analysts believe that the entry of social capital will vigorously promote the development of rail transit industry and drive the performance growth of upstream and downstream enterprises in the industrial chain.

The implementation of PPP projects was accelerated

Listed companies have won the bid track PPP projects

1. In December 2016, China railway announced that the company, its wholly-owned subsidiary and the consortium formed by CRRC won the bidding for the PPP project of phase I of wuhu rail transit line 1 and line 2. The project is located in wuhu city, anhui province. The total length of the line is 46.8 kilometers. The total investment of the project is estimated to be about 14.6 billion yuan. The construction period is 3 years and the operation period is 27 years.

2. CRRC announced on December 28 last year that it had received the notice of winning the bid and confirmed that the consortium led by CRRC had won the PPP project of kunming rail transit line 9. The project is located in kunming city, yunnan province, with a total line length of about 50.4 km and an estimated total investment of about 22.4 billion yuan. The construction period will not exceed 5 years and the franchise period will be 30 years.

3. In September 2016, the share announcement of the tunnel said that the company united Greenland holdings won the bid for the PPP project of nanjing metro line 5, with a total investment of 19.613 billion yuan.

Insiders said that out of the nearly 4,000 PPP projects in three batches recommended by the national development and reform commission in the past three years, the urban rail projects alone have involved a total of one trillion yuan, accounting for about 16 percent of the total investment.

PPP mode has become an important driving force for the sustainable growth of the rail transit industry. According to the statistical bulletin on the development of the transport industry in 2016 released by the ministry of transport in mid-april, the total length of China's railways in operation reached 124,000 km at the end of 2016, up 2.5 percent from the end of the previous year. Among them, high-speed rail operating mileage of more than 22,000 km. In 2016, a total of 801.5 billion yuan was invested in railway fixed assets, and 3,281 kilometers of new railway lines were put into operation. Among them, 1903 km of high-speed railway. Rail transit has been launched in 30 cities across the country, including four new ones in 2016. It has 2,468 rail transit stations, an increase of 376. There were 23,791 vehicles in operation, up 19.3 percent.

Companies will benefit

According to the white paper on China's transport development, by 2020, China will have 30,000 km of high-speed railways in service, covering more than 80 percent of major cities. About 30,000 kilometers of newly rebuilt expressways are open to traffic. By 2020, intercity railway networks will be basically completed in the urban agglomerations of the beijing-tianjin-hebei region, the Yangtze river delta, the pearl river delta, the middle reaches of the Yangtze river, the central plains, chengdu-chongqing and the shandong peninsula.

Industry insiders believe that, benefiting from the PPP model, related companies will share the benefits brought by the rail infrastructure, and they are optimistic about the opportunities brought by the intercity railway development and the investment opportunities of the whole industry chain brought by the certainty growth of high-speed railway.

China railway achieved 639.407 billion yuan in operating revenue in 2016, up 2.95% year-on-year. The net profit attributable to shareholders of the listed company reached 12.509 billion yuan, up by 2.05% year-on-year. The company said that thanks to the investment in the domestic infrastructure construction market and the implementation of the "One Belt And One Road" initiative, the amount of new contracts signed by the company exceeded 1 trillion yuan for the first time during the reporting period, reaching 1235 billion yuan, up by 29% year-on-year. Of this, 291.16 billion yuan was newly signed in PPP and other infrastructure investment, up by 593 percent year-on-year.

In 2016, the operating revenue of shenzhou high-speed railway reached 1.876 billion yuan, up 44.86% year on year. Net profit was 522 million yuan, up 181.07%. According to the shenzhou high-speed railway, a number of urban rail projects have been approved, and many fourth-tier cities have issued urban rail construction plans. In the next five years, infrastructure and operation and maintenance in the urban rail sector will be in good shape. In the future, China high-speed railway hopes to participate more in related industrial projects with the help of PPP model.

The promotion of PPP mode will ensure the effective implementation of construction demands such as urban rail investment, which will benefit relevant engineering and equipment manufacturing enterprises, and the core parts manufacturing enterprises of urban rail transit will have great development space.