China vehicle maker Great Wall H1 net dips 16.6 pct


HONG KONG, Aug 19 (Reuters) - Chinese truck and sports utility vehicle maker, Great Wall Automobile Holding Co. Ltd. , said on Thursday that its net profit for the first half fell 16.6 percent on rising costs and lower sales as China's auto market slowed in recent months.

Great Wall, the 11th-largest vehicle maker in China, reported net profit of 239.08 million yuan (US$28.87 million) in the six months ended June against 286.74 million yuan the previous year.

Turnover fell more than one percent to 1.87 billion yuan.

The number three seller of sport utility vehicles in China raised about US$222 million in a heavily-subscribed IPO last December. It planned to use the proceeds to expand its annual production capacity to 150,000 by 2005 from 70,000.

But shares of Hebei-based Great Wall had lost more than 47 percent through Wednesday's close from their IPO price of HK$13.30, amid fears of oversupply in China's car market.

After nearly doubling last year to about 2 million, car sales growth in China has slowed sharply in recent months after the government implemented credit-tightening measures in a bid to rein back its racing economy.

Worries about overcapacity in a sector that is attracting billions of dollars in investment from global giants has also battered the share prices of domestic auto makers.

(US$1=8.28 yuan)



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