China Shipping Development, the country's biggest oil carrier, plans to buy 42 dry bulk and container vessels from its parent company for more than two billion yuan, according to a senior executive. Hong Kong-listed China Shipping, which operates more than 180 vessels, will fund the purchase by issuing two billion yuan worth of convertible bonds to China Shipping Group, the executive said. Trading of China Shipping's shares was suspended yesterday. The stock has gained 48.4 per cent this year to HK$8.46, outpacing the 24.05 per cent growth in the benchmark Hang Seng Index. 'We believe that [the expected fleet acquisition] is one of the reasons for [China Shipping Development's] strong share price performance recently,' BOC International said in a research report last week. 'We believe a more conscious view has to be taken with regards to this acquisition.' BOCI said investors should also pay attention to the acquisition price, the profitability of the fleet and some specifications of the fleet such as capacity and routes. China Shipping is buying dry bulk carriers amid a recovery in the industry. The Baltic Dry Index, which tracks global freight rates, has risen 65.6 per cent this year. The company is also expanding its oil tanker fleet to tap rising demand for energy especially in China. China Shipping last week said it had ordered four very large crude carriers for US$460 million, which will be delivered by 2010. Earlier, it also agreed to buy a 50 per cent stake in a Shanghai shipping firm held by a joint venture for 411 million yuan and plans to liquidate the venture after the deal. China Shipping last month secured a US$168 million, 12-year syndicated loan to buy two very large crude carriers. Net profit for the third quarter rose to 715.5 million yuan from 548.6 million yuan a year earlier while sales rose 20 per cent to 2.48 billion yuan from 2.07 billion yuan.