CRRC to spin off locomotive tech unit for ChiNext IPO

China International Capital Corporation Limited (CICC) has verified that CRRC's proposed spin-off of CRRC Qishuyan Locomotive and Rolling Stock Technology Research Institute Co., Ltd. (CRRC Qishuyan) for listing on the Shenzhen Stock Exchange’s ChiNext board complies with regulations. The spin-off is expected to enhance CRRC's focus on its core businesses, while allowing CRRC Qishuyan to boost its capital strength and development capabilities, leveraging capital market support.

The spin-off is deemed to align with national strategies, deepen state-owned enterprise reform, and facilitate high-quality development. CRRC Qishuyan specializes in high-end equipment key components and system solutions, covering areas like rail transit, energy, and intelligent manufacturing. The spin-off is anticipated to improve CRRC's valuation, as it allows for a more distinct market assessment of the subsidiary's value.

Financial data indicates that CRRC has been profitable for the past three years, with net profits attributable to shareholders (after deducting CRRC Qishuyan's net profits) exceeding 600m yuan. Related announcements also confirm that CRRC Qishuyan’s financial metrics, such as net profit and net assets, meet regulatory thresholds for the spin-off. Independent auditors have verified the compliance and accuracy of the financial information provided.