Asian Rail: Borrowing on the Fast Track

It looks as if the increasing rise in fuel prices could be having repercussions wider than just airlines, who we blogged on yesterday. China Railway Group Ltd (0390), whose subsidiaries include irrigation works, ports, docks and airports, has seen its share price fall from 9HKD in January to 7.3HKD today. Thus, the percentage of the company's Market Cap out on Loan to short investors (%MCOL) has increased from 0% in December, to 8.7% today; a sizable amount for a an Asian stock (please click to enlarge graphs).

Even more surprisingly, Utilisation is at 54%, so there is still plenty left to borrow, with 9 days to cover for those investors who wish to buy back shares. The average Utilisation for the rest of the Asia Capital Goods sector is 13%, and for the rest of the Hong Kong Small Caps it is 18%. This stock is by far the most borrowed company in its sector, with Noble Group Ltd (N21) having a %MCOL of 4% in second place.

In the Hong Kong Small Caps, Guangshen Railway (0525) is the most borrowed company, with 10% MCOL (big fry for Asia). It appears that railways are fairly easy to borrow, as this stock's Utilisation is also low at 37%. There are 19.74 days to cover for those who think the price will rebound - it has already fallen from 6.9HKD to in October 2007 to 4.2HKD today and has risen slightly since May 12th. 24.5% of the Market Cap is still Lendable as opposed to China Railway's 4.11%.