Shui On Construction and Materials expects public housing projects open for tender this year to double to $10 billion after Chief Executive Tung Chee-hwa's pledge to increase public housing. Managing director Lawrence Choi Yuk-keung said there would be 21 housing projects open for tender in the second half, doubling the projects available last year. He said Shui On had outstanding contracts worth $6 billion and expected to complete contracts worth at least $4 billion this financial year. 'Operating profit margins at the construction division improved from 4 per cent to 6 per cent, partly boosted by well-controlled operating costs and partly due to the price increase of the projects,' Mr Choi said. New China Hong Kong research manager Cliff Shum Kwok-hei said the higher profits would improve Shui On's bottom-line. He expected the trading of construction materials, which accounted for 60 per cent of the $267 million operating profit in 1997, to remain the main source of earnings this year. Despite the optimistic outlook, Shui On's shares have under-performed on the Hang Seng Index since listing. Its shares closed down 10 cents at $8.10 yesterday, lower than the $9.3 issue price. Chairman Vincent Lo Hong-sui said Shui On would soon finalise its joint-venture cement plant in Nanjing. He said the issue at stake was whether Shui On would directly invest in the project or through its 50 per cent-owned associate, Far East Cement.