Ernst & Young: The number of new contracts signed by eight listed construction companies reached a new high in the first half of the year

China Securities Network news (reporter Liu Yang) On October 13, Ernst & Young released the "China Construction Industry in the first half of 2021 Performance Overview" report. According to the report, in the first half of 2021, the total operating revenue of eight listed construction enterprises increased by 29.5% year-on-year, and the amount of new contracts signed reached a new high.

The eight listed construction companies listed in the report are China State Construction, China Railway, China Railway Construction, China Communications Construction, China Metallurgical, Power China Construction, China Neng Construction and Shanghai Construction Engineering.

The total operating revenue of eight major listed construction companies totaled 2,995.4 billion yuan, up 29.5 percent year on year, according to the report. Net profit and net interest rate rose year-on-year, of which the net profit of China Energy Construction, China Communications Construction, China MCC and China Railway Construction increased by 101.97%, 90.97%, 54.10% and 29.5%, respectively. China's construction net interest rate continues to lead the level, the current net interest rate of 4.28%, in the forefront of the industry. In addition, the total asset size of the eight listed construction companies has steadily increased, with an average year-on-year growth of 13.46%. The asset-liability ratio remained stable, with the average asset-liability ratio of 75.54%, a slight increase of 0.10 percentage points year-on-year.

The new contracts signed by the eight major listed construction enterprises listed in the report reached a new high. In the first half of 2021, the epidemic has not completely ended in the world, and the total amount of new contracts signed by eight listed construction enterprises reached 6,292.4 billion yuan, an increase of 24.27%.

Shen Yan, head of construction and engineering industry at EY, believes that the implementation of major national strategies provides new opportunities for the construction industry. Shen Yan said: "The implementation of the national '3+2+1' six major regional strategy has expanded the construction market space, provided a leading direction, and also put forward clear work requirements for the high-quality development of the construction industry."

"Under the new development pattern with the domestic great cycle as the main body and the domestic and international double cycle promoting each other, the country focuses on new industries and new formats and new models to release development momentum, providing a broad platform for the development of the construction industry." New industries such as services, culture, resources, environmental protection, elderly care tourism, health, and the Internet, especially the deep integration of traditional infrastructure and '5G, artificial intelligence, and industrial Internet', all need the support of the construction industry. At present, the construction market is showing the coexistence of old and new infrastructure and diversified forms." Shen Yan said.

Yang Shujuan, Managing partner of EY Greater China Government and Infrastructure Market and Managing partner of EY Beijing, said that the coordinated development of smart construction and construction industrialization will bring a new round of industrial adjustment, and the digitalization, networking, visualization, automation and intelligence of the construction process will also lead the development direction of the construction industry. In addition, the "14th Five-Year Plan" proposal made it clear to continue to deepen the supply side structural reform as the main line, downplay economic growth, highlight reform and opening up, and accelerate the construction of a "double cycle" new pattern. Yang Shujuan believes that the adjustment of the construction industry market structure and changes in the competitive landscape will urge construction enterprises to continue to innovate, and actively adjust the business structure and business model to respond to the opportunities and challenges brought by changes in the industry.