Guangshen Railway Company Limited (Guangshen Railway), a core asset under the Guangzhou Railway Group, serves as its primary listed platform. Its operations span railway passenger and freight transport, as well as network settlement services, making it the only A/H dual-listed railway operator under China State Railway. In 2024, the company reported total revenue of RMB 27.09 billion (+3.4% YoY) and net profit attributable to shareholders of RMB 1.06 billion (+0.2% YoY). Passenger transport contributed RMB 11.00 billion (40.6% of total revenue), while network settlement accounted for RMB 12.69 billion (46.8%).

**Cross-Border Services Emerge as Growth Driver** Passenger revenue is segmented into Guangzhou-Shenzhen intercity, cross-border express, and long-distance services. During the pandemic, cross-border operations between mainland China and Hong Kong were suspended. However, the resumption of the Hong Kong West Kowloon-Futian high-speed rail link in January 2023 spurred rapid recovery in cross-border express services, with revenue surging from RMB 260 million in 2019 to RMB 2.26 billion in 2024. Its share in passenger revenue climbed from 3.3% to 20.6% over the same period.

**Guangzhou East Station Upgrade Accelerates High-Speed Rail Transition** In July 2025, Guangshen Railway, Guangzhou Railway Group, and the Guangzhou municipal government agreed to jointly redevelop Guangzhou East Station. The company will contribute station assets and land valued at RMB 5.209 billion, retaining 38.65% equity in the project company. Post-completion, Guangshen Railway will operate the station’s rail transport segment. Short-term, the project may yield one-time asset revaluation gains; long-term, it positions the company to fully integrate into high-speed rail operations within the Guangzhou hub.

With Guangzhou-Shenzhen’s rail hub modernization accelerating, cross-border high-speed rail services demonstrating robust performance, and the imminent Guangzhou East Station overhaul, Guangshen Railway is poised to enter a high-speed rail-dominated era across equity, assets, and operations—bolstering profitability. Projected net profits for 2025–2027 are RMB 1.27 billion, RMB 1.36 billion, and RMB 1.45 billion, respectively, with corresponding P/E ratios of 18.7x, 17.5x, and 16.3x. Compared to peers like Daqin Railway, Beijing-Shanghai High-Speed Railway, and Tielong Logistics (2025 average P/B: 1.09x), Guangshen Railway’s 2025 estimated P/B of 0.87x appears undervalued. Initiated with a "Buy" rating.

**Risks**: Macroeconomic downturns, operational underperformance, new route competition, delays in Guangzhou East Station redevelopment.