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Eric Ng

Citic Group says it plans to separately list its property, heavy machinery and  car wheel manufacturing businesses this year, despite unfavourable property and financial market conditions.
The group, one of  the mainland's largest state-backed conglomerates, has added several strategic investors to the listing of its property unit,  Citic chairman Kong Dan  said on the sidelines of the National People's Congress, without naming them.
'We have not decided whether to list it in Hong Kong or the mainland or both, it depends on market conditions,' he said, adding that a formal application to regulators had not been submitted.
The unit last year posted a net profit of more than 1 billion yuan (HK$1.1 billion), he said.
According to the group's website, the unit had  about 16 billion yuan in assets and developments totalling 3.7 million square metres  under construction at the end of 2006.
It had 8.03 million square metres in land reserves suitable for residential development,  and realised 7.22 billion yuan   in sales and completed 710,000 square metres of property in 2006.
Its project portfolio covers large cities such as Beijing, Guangzhou, Shanghai and Shenzhen, as well as smaller ones.
Mr Kong said the group also hoped to spin-off Henan province-based Citic Heavy Machinery and Hebei province-based Dicastal Wheel Manufacturing on the A-share market this year.
The group's 50-year-old heavy machinery unit makes equipment for the mining, construction materials, metallurgy, power generation, chemical and environment protection sectors.
It posted a net profit of  450 million yuan on turnover of  3 billion yuan last year.
Alloy wheel maker Dicastal, which produced 10 million  units in 2006, is  the mainland's largest producer.  It exports just under half its output to Europe, North America, Japan, South Korea and Australia.
Meanwhile, Mr Kong said the group  would continue to seek overseas acquisitions despite turbulent market conditions caused by the  United States subprime credit crisis.
It is still in negotiations with US investment bank Bears Stearns on the terms of an investment deal struck in October. Citic Securities had agreed to pay US$1 billion for a 6 per cent stake in Bear Stearns with the latter paying the same for a 2 per cent stake in the mainland brokerage.
Shares of both firms have  plunged more than 40 per cent since then.
Mr Kong said the group  would not be deterred by Kazakhstan's imposition of an oil export tax and remained interested in investing in infrastructure and oil refining there.
'We cannot take a short-term view in our overseas investments,' he said. 'While tapping into overseas resources,  we should  help  host countries build better infrastructure and provide them with good products.'
The group had built more than US$1 billion worth of social housing units for the government of  Angola, the  second-largest oil exporter to China, he added.



Citic Group  considers listings for property, other business units