About a year ago Core Pacific-Yamaichi maintained its 'buy' recommendation on Shenzhen Expressway as traffic flow remained strong and all road projects reached double-digit growth for October 2003. Increase in traffic was mainly due to robust economic activity and surging sales of cars in the mainland. In the first nine months of the year, car sales increased 69 per cent year on year. Core Pacific set a price target of $2.70. The counter was trading at $2.375 about that time. The brokerage maintained its earnings forecasts for the company. With the disposal of NH107 and NH205 in the first half of this year, earnings growth depended on acquiring quality road projects that offered immediate returns. It expected to make an acquisition in the first half of 2004. In August Shenzhen Expressway said it would bid for new Pearl River Delta projects to plug an earnings gap arising from the 1.93 billion yuan sale of two national highways. Twenty-nine state-owned toll-road projects were on offer to foreign investors in the thriving region. The company vowed to compete for about 70 per cent of these in the second round of tendering in the next few months. A key project interesting Shenzhen Expressway was the Guangzhou-Zhuhai section of the national highway running between Beijing and Zhuhai, said chairman Chen Chao. The pressure to rebuild earnings flow was lessened somewhat in the first six months of this year as recurring profit jumped 45.71 per cent over the same period last year. Net profit in the first half was 72.25 per cent lower at 208.7 million yuan, as the base of comparison in the previous period was inflated by a one-off gain of 691.41 million yuan from the disposal of the Shenzhen sections of national highways 205 and 107. In the past five months the firm had bought three Guangdong toll roads and a Jiangsu toll bridge in a 1.09 billion yuan acquisition spree. The counter closed at $2.875 on Friday.