Earnings upgrades likely for H-shares

Specialists expect accelerated appreciation of the renminbi to drive up ChinaÆs consensus earnings growth estimates.

Chinese companies listed in Hong Kong deserve an earnings upgrade because the renminbi is on course to appreciate up to 13% in 2008, say analysts who expect the Chinese authorities to use currency appreciation as a key tool this year to manage an escalating inflation threat.

For Chinese companies reporting in Hong Kong dollars, a stronger renminbi will result in a bottom line gain simply as a result of the currency translation -- something which hasn't yet been fully factored...

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