SHARES of China’s top trainmaker CRRC Corp., formed from a merger between CSR Corp. and China CNR, surged yesterday after a month-long trading halt.

    The firm, now the world’s largest in terms of market value following its merger, surged its 10 percent daily limit in Shanghai and gained 4.53 percent in Hong Kong.

    CSR and CNR, which had been China’s two largest trainmakers, announced last week that they had completed their government-driven merger through a share swap, which saw CNR absorbed into CSR and delisted.

    The new company is expected to aggressively compete with the likes of Siemens AG and Alstom SA for overseas deals, especially in the area of high-speed rail.

    “A world leader on the way,” Barclays analyst said in a note last week. “We expect CRRC to expand its dominance from China to the global market.”

    CRRC comes on the scene at a time of upheaval in the global rail industry. Canada’s Bombardier Inc. is pondering the future of its rail business — CSR and CNR were said to have considered taking a controlling stake — and Italy’s Finmeccanica SpA unloaded its rail-signaling business to Japan’s Hitachi Ltd. in February.

    While China’s rail technology may not be quite at the level of Siemens’, said Lawrence Li, a Shanghai-based China industrial analyst for UOB Kay Hian Investment Co., “CRRC’s main competitive strength is that its technology will be offered as part of a package by China that includes financing and construction.”

    Close to home, China’s rail push puts it in direct competition with Japan for contracts in Southeast Asia. Further abroad, both countries are eyeing a proposed high-speed rail project in California.

    European and North American competitors also will face stiffer competition as the new Chinese behemoth pursues overseas deals.

    Chinese companies already were known for their aggressive tactics. Last year, CNR won China’s first major rail contract in North America — a US$567 million deal for Boston subway trains — with a proposal nearly 50 percent cheaper than Montreal-based Bombardier’s bid.

    Siemens, Alstom and Bombardier “were big guys, and suddenly there’s a big, big guy,” Canadian Economy Minister Jacques Daoust said last month, when CSR and CNR were said to be weighing their bid for Bombardier’s rail unit. “It’s a concern.” (SD-Agencies)