Shenzhen Expressway will accept lower project returns and aims at diversifying away from its core road businesses in a bid to expand its asset base.
The firm was confident of plugging its profit shortfall within three years after last month announcing the 1.93 billion yuan (about HK$1.82 billion) sale of two profitable national highways to its parent, chairman Chen Chao said yesterday.
'We are looking for toll-road projects in Guangdong and the Pearl River Delta and ports and logistics projects in Shenzhen,' Mr Chen said.
The company's net profit fell 14.57 per cent to 359.93 million yuan last year due largely to expiry of tax allowances and reduced construction management income.
The two recently sold sections of national highways 107 and 205 contributed 120 million yuan to its bottom line last year - representing one-third of group profit.
In a bid to expand its asset base, the firm plans to lower its threshold for choosing new projects to an internal rate of return (IRR) of 10 per cent.