PUBLISHED : Sunday, 23 April, 2006, 12:00am
UPDATED : Sunday, 23 April, 2006, 12:00am

About a year ago Merrill Lynch upgraded its recommendation on Angang New Steel, one of the mainland's biggest steelmakers, to 'buy' based on plans to acquire the parent company's steelmaking assets and surprisingly strong profits in 2004.

Angang reported a 25.44 increase in net profit as steel prices soared. Earnings reached 1.79 billion yuan compared with 1.43 billion yuan in 2003.

The broker set a price objective of $6.25. The counter was trading at $4.425 a year ago.

This month Angang New Steel posted a 17.79 rise in net profit last year to 2.11 billion yuan as turnover increased 14.03 per cent to 26.48 billion yuan. And yesterday it said first-quarter profit rose 82 per cent after a new factory boosted sales. The stock closed on Friday at $7.50.