CHINA Railway Group rose nearly 69 percent in its Shanghai trading debut yesterday, on expectation it will benefit from the nation's huge spending on transport infrastructure construction.

But some analysts, perhaps feeling that the shares could have gone higher, said the jump in the world's No. 3 construction contractor's first day of trading was hurt by the recent general weakness in the stock market. They, however, said the rise in the share price was within expectations.

China Railway closed at 8.09 yuan (US$1.1), after opening at 7.5 yuan, a jump of 68.54 percent from its initial public offering price of 4.8 yuan.

"The relatively lackluster rise gave China Railway room to keep climbing over the coming sessions," said Chen Huiqin, an analyst of Huatai Securities. "PetroChina has taught a lesson to mainland investors."

About one month ago, PetroChina Co more than doubled in its Shanghai debut to close at 43.96 yuan. But the frenzy first-day performance could not be maintained and the nation's top oil firm tumbled in subsequent sessions on concerns it is overvalued. PetroChina closed at 30.44 yuan yesterday.

Beijing-based China Railway dominates the domestic railway building industry. The firm could get a major boost from China's budget of 5.05 trillion yuan in the transport construction sector for five years through 2010, analysts have said.

China Railway was trading at more than 40 times its estimated 2007 earnings, based on yesterday's close, higher than domestically-listed construction firms.

China Railway raised 22.44 billion yuan in its Shanghai share sale on record subscriptions, and another HK$19.2 billion (US$2.46 billion) from a Hong Kong IPO. Its Hong Kong shares will start trading on Friday.