Shares in Hong Kong-listed Air China shot up 18 percent to a record high of HK$7.27 (US$0.93) last month following an announcement that fi rsthalf net profi t for 2007 would be 20 times higher than a year earlier, the China Economic Review reported.

The carrier said its strong fi nancials were driven by growing demand, renminbi appreciation and returns on unspecifi ed investments. However, analysts stressed that the profi t projection looks quite different when calculated according to international accounting standards rather than Chinese ones. Under international standards, profi t has only doubled over last year. Nevertheless, analysts were generally bullish about Air China’s prospects, describing it as the strongest of China’s three state-run airlines.

In a related development, China’s other two major airlines, China Southern Airlines and China Eastern Airlines, expect to post fi rst-half profi ts thanks largely to “continuous growth of the domestic market” and the appreciation of the yuan. China Southern said it expected a reversal from its CNY835 million (US$110.4 million) loss in the year-ago semester, while China Eastern is expecting to return to the black following a CNY40 million loss in the 2006 fi rst half.