This upgrade reflects previous corrections of share prices and current attractive valuation on Hong Kong Exchange.

Meanwhile, UBS gave “Sell” rating on A-share of Guangshen Railways with target price at 7.63 yuan.

UBS said that the railway passenger volume between Guangzhou and Shenzhen has demonstrated accelerating growth, with annualized growth for October at 45.2 percent. It predicted that the passenger volume between the two places would see 19.3 percent and 15 percent increase in 2008 and 2009 respectively.

The investment bank also mentioned anticipation for capital injection from parent company in the future, and said the Ministry of Railways is considering easing control on train ticket prices as from 2008.

On Monday, the A-share price of Guangshen Railways closed at 8.91 yuan, up 0.18 yuan or 2.06 percent, and its H-share price went up 0.52 percent to end at 5.80 yuan. (Edited by Liu Yanan; e-mail: )