Shenzhen Expressway Company (SEHK:548) was established on 30 December 1996. It is principally engaged in the investment, construction, operation and management of toll highways and roads. The Company aims at enhancing the ability of wealth creation by improving the quality of operation, obtaining reasonable returns through providing high-quality service to the society, and achieving satisfaction of customers, employees, shareholders and related parties by balancing their interests, so as to foster the Company’s sustainable development. Currently, the Company will maintain its market orientation, focus on the expressway industry, actively explore and engage in new investments in the industry for a synergistic growth in both its scale and efficiency.1

In the early stage of establishment, the operating revenue and profit of the Company were derived mainly from the three toll highway assets injected by the promoter. On an equity basis, the mileage of expressways was approximately 11 km, while the mileage of Class 1 highways was approximately 70 km. After over a decade’s development with listing on the financing platforms in both Hong Kong and the PRC, the Company has leveraged on the efforts of its own management team in building a number of high-quality expressways and provision of outstanding construction management and operation management services for government and private-invested highway projects. The Company has also further expanded its coverage to Guangdong Province and other economically developed regions in the PRC by ways of acquisition and participation. As at 30 June 2015,  the Company operated and invested totally 16 toll highway projects, and the mileage of the highways invested by the Company (on an equity basis) is approximately 413km.

The principal business structure of the Company is set out as follows:


Business Segments

Toll Roads & Bridges

Shenzhen Expressway established Shenzhen High-speed Operation Development Co., Ltd. at the end of December 2016, which is mainly responsible for the operation and maintenance of deep high-speed straight pipeline sections such as Meiguan, Jihedong, Jihexi, Yanba, Yanpai and Nanguang. Management work, and Shenzhen Investment Holdings Co., Ltd. and Shenzhen International Holdings Co., Ltd. escrow the Guangzhou-Shenzhen Expressway Shenzhen section and Longda Expressway, with a mileage of 156.6 kilometers, 33 toll stations, 511 toll lanes and 6 tunnels. In recent years, the traffic volume of the company's straight pipeline section has increased year by year, and the toll revenue has continued to increase. In 2016, the toll revenue of the straight pipeline section exceeded 2 billion yuan.2

Entrusted Management

The entrusted construction management business and the entrusted operation management business, also known as agent construction business and agent operation business, are the major businesses of the Group in addition to its toll highway business currently. Leveraging on its expertise and experience accumulated in relevant areas during these years, the Group has realised reasonable revenues and returns from the receipt of management fee and/or bonus according to the calculation method as agreed with the entrusting party through the provision of services relating to construction management and toll highway operation management. The entrusted construction business and entrusted operation business of the Group mainly include Coastal Project, Nanping (Phase II), Guilong Project and Longda Project, etc.3

Other Business


Shenzhen High-speed Advertising Co., Ltd. (the Advertising Company) was established in 1999, which is a wholly owned subsidiary of the Company. Over the years, the Advertising Company has developed into an integrated advertising company with a blend of brand management, marketing planning and media release based on abundant resources of its own high-speed media. The Advertising Company is taking functions of several industries, such as the unit of director of Shenzhen Advertising Association (中国广告协会) and the unit of secretary general of China High-speed Road Advertising Alliance (中国高速公路广告联盟). It has honored as “Qualification of China 1st Class Advertising Company (综合服务类中国一级广告企业)”, “China Top Ten High-speed Road Advertising Companies (中国高速公路十强企业)”, “Shenzhen Top One Hundred Cultural and Creative Industry Enterprises (深圳市文化创意产业百强企业)” and so on.4

Engineering Consulting

Shenzhen Expressway Engineering Consulting Company Limited (the Consulting Company) was incorporated and registered in August 2002. It’s a professional engineering consulting company initiated and established by the Company and now the Company holds 24% of interests in it.

The Consulting Company has received various qualifications since foundation, such as first-grade qualification on engineering consulting, first-grade qualification on comprehensive engineering investigation, first-grade qualification on road engineering design, first-grade qualification on municipal engineering design, first-grade qualification on project bidding agency. The Consulting Company has passed the accreditation of IS09001:2008 Quality Management System.

The operation of the Consulting Company heads to the engineering consulting field which is multi-industrial with full life-cycle. The business of the Consulting Company covers such as pre-project consultancy, engineering investigation and design, tendering agency, cost consultancy, engineering supervision, engineering experiment, project testing, road maintenance management. It has the qualification and service capacity of advisory services in the whole process of project investment and construction.

With the purpose of capitalizing the Group’s core competences in the construction management service area, the Company has exercised control over Consulting Company with effect from 1 July 2015. Since 1 July 2015, Consulting Company has been converted from an associated company to a subsidiary of the Company and accordingly, consolidated into the Group.

Inter-network Toll Collection

Guangdong United Electronic Toll Collection Inc. (“Guangdong UETC”) is principally engaged in electronic clearing business of the toll highways in Guangdong Province, including investment, management and services of electronic toll and clearing systems, and the sale of related products. The Company holds 15% of interests in Guangdong UETC.

Financial services business

In 2015 and 2016, the company subscribed for additional shares of Guizhou Bank. As of the end of 2017, it held a total of 426 million shares of Guizhou Bank, holding approximately 3.78% of its total share capital after the capital increase. The subscription of additional shares of Guizhou Bank can optimize the asset allocation of the Company and will have a good synergy effect on the subsequent infrastructure investment operations of the Company in the relevant regions. In 2011, the company established a wholly-owned subsidiary, Shenzhen Expressway Investment Co., Ltd., which is mainly engaged in urban comprehensive development and urban infrastructure investment, construction management and operation, carrying the important mission of the company's industrial transformation and upgrading; for the development of urban transportation and environmental protection industry chain Investment platform, play the role of equity investment mergers and acquisitions, the company established the Shenzhen Express Industry Investment Fund Management Company in December 2017, mainly investing in urban infrastructure construction, intelligent transportation, energy conservation and environmental protection, and new energy and other main industry chain projects, in line with the company's transformation development of.

Project development and management

In recent years, relying on the core business, the Company actively researches and attempts the new business model, in order to support the long-term sustainable development of the Company.

Guilong Land: The peripheral land of Guilong Project which were successfully bid by the Group. As at the end of the Reporting Period, the area of the land was approximately 2,310 mu (approximately 1,540,000 square meters).

Guilong Development Project: The further property development project of the Guilong Land with an area of 300 mu (approximately 200,000 square meters) conducted by the Group.

Meilin Checkpoint Renewal Project: Shenzhen Longhua New Area Mingzhi Office Meilin Checkpoint Urban Renewal Project, the entity of which is United Land Company and the land of which is approximately 96,000 square meters.


The Company will implement the innovative development strategy of dual core businesses, seriously, prudently but actively develop the toll highway business and general-environmental protection business, ensuring that the targets for investment and acquisition meet the development scale, financial resource security and tolerance and the industry policy and environment of the Company, rather than simply seeking for scale effect. In mid and short term, the toll highway business will still account for a big proportion in terms of asset scale and income scale. However, in the long run, general-environmental protection business will keep pace with the toll highway business, and the two business sectors will become the key cornerstones for the development of Shenzhen Expressway.5

Due to the scarcity of high-quality expressway project resources, in the future, for the toll highway business, the company will focus on project expansion, while taking into account the high quality projects within its capacity.

Development strategy for general-environmental protection business: the Company will further enhance the development efforts and establish strategic cooperation with the existing partners and the industry leaders.

In its future acquisitions, the company will target at holding project and focus on proper market segments, in order to increase the industry scale and volume and provide “booster” for the two-wheel drive of the Company

Future plan

2019 is the last year for the five-year strategy. The Company is now preparing for the next fiveyear strategic planning. Many factors will be considered in the new strategy, but the strategic positioning of developing dual core business of toll highway + general-environmental protection will not be changed. The Central Committee of the Communist Party of China and the State Council issued the Opinions on Supporting the Program of Building Shenzhen into the Pilot Demonstration Area of Socialism with Chinese Characteristics in recent days. Shenzhen will receive great development opportunities. Shenzhen Expressway will, based in Shenzhen and great bay area and extending to the whole nation, create smart highways, distinguished environmental protection and high-quality wind power. The company hope that in the next 5 years, Shenzhen Expressway will form the three key advantages of “toll highway + distinguished environmental protection + high-quality wind power”. In the longer term, the company hope that Shenzhen Expressway will become a listed company with outstanding performance, good governance, and healthy market image which can bring rich return to the shareholders and are well recognized and loved by the employees.

Financial highlight

t in the first half of 2019, the Group recorded revenue of RMB2,699 million, representing a YOY increase of 0.81%, excluding the effect of the toll revenue from the Three Projects for the corresponding period of last year, the comparable revenue increased by 15.57%; and realized net profit of RMB1,577 million with earnings per share of RMB0.723, representing a YOY increase of 62.79%.6

The Company has specified the dual core business development direction of toll highway + general-environmental protection industry in the Development Strategy for 2015-2019. The strategic thinking of the dual core business does not mean that the Company shall give up the toll highway business. Instead, it specifies how the company should treat the toll highway business. During the strategic period, the toll highway investment of the Company amounted to RMB20 billion, and the equity mileage of toll highway increased by 100km. After two years of practice and deployment, the Company has entered the general-environmental protection industry and focused on such fields as hazardous waste treatment, organic waste treatment, industrial wastewater treatment and wind power. After nearly 5 years of hard work, the total investment in new projects amounted to RMB23 billion, and the quality of the invested projects was excellent. At present, the Company’s asset structure has been optimized. Practice has proved that Shenzhen Expressway has the capability for sustainable development, and the strategic direction of dual core business is correct.


  1. ^ http://www.sz-expressway.com/en/CompanyProfile/index.aspx
  2. ^ http://www.sz-expressway.com/en/glyy1078/index.aspx?page=2
  3. ^ http://www.sz-expressway.com/en/EntrustedManagement/index.aspx
  4. ^ http://www.sz-expressway.com/en/qtyw2289/index.aspx
  5. ^ http://www.sz-expressway.com/uploadfiles/2019/08/20190830175316498.pdf
  6. ^ http://www.sz-expressway.com/uploadfiles/2019/08/20190830175316498.pdf
Created by Asif Farooqui on 2020/03/16 08:56
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