Companies in the energy and mining industry make up the largest group of China's most attractive listed firms, according to the latest Hurun Report.

Twenty-one of the country's top 100 domestically listed and 17 of the top 100 overseas-listed companies are in the energy and mining industry, the research company said yesterday.

The survey is the second from Hurun Report, founded by Englishman Rupert Hoogewerf (better known as Hu Run), on the investment potential of China's listed companies.

Baoji Titanium Industry Co Ltd, based in Northwest China's Shaaxi Province, topped the list of the country's A-share companies with the most investment potential, with a growth rate of 663 per cent in the 12 months ended June 1 this year.

China National Petroleum Corporation Hong Kong Ltd had the greatest investment potential of overseas listed companies in the energy and mining field, with a growth rate of 246 per cent within the same period.

The energy and mining industry's rosy performance was largely due to the surging price of raw materials, said Zhang Zhi, an analyst from Everbright Securities Co.

But the analyst questioned the methodology of the rankings, saying past performance does not necessarily indicate future potential.

The Hurun Report's rankings on the most attractive Chinese companies listed both at home and abroad this year were based mainly on the growth rate of stock prices over the past year.

The company said it had surveyed over 1,500 companies listed in Shanghai, Shenzhen, Hong Kong, NASDAQ, New York, London and Singapore.

"I think whether a company has investment potential or not depends more on its future prospects instead of its past performance," Zhang said.

He said future prospects, the price-to-earnings ratio and market clout are the most crucial indicators of a company's investment potential.

"This is a more static than dynamic ranking," Zhang said. "It is more like a sum-up."

According to the report, Wumart Stores Inc, a private retail chain store based in Beijing, topped the overseas listed companies ranking with a growth rate of 420 per cent in the 12 months from June 1 last year.

In the first half of this year, Wumart's shares grew by 72 per cent when the company acquired two rival chains.

In February, Wumart took over Meilianmei, the fourth-largest retailer in Beijing, for US$46 million.

In April, it bought out Xinhua Department Store based in Yinchuan, Northwest China's Ningxia Hui Autonomous Region, for US$22 million.

Wumart's strong growth was fuelled by the country's faster urbanization process, consumers' greater purchasing power and government efforts to spur domestic demand, the report said.

"The retail industry usually gets a premium for their stock prices," Zhang said.

But the ranking report has not been well received by some analysts.

"We don't want to comment on the report since we don't give that kind of classification," said Fang Bo, an analyst from Shenyin Wanguo Securities.

He said the rankings were more market hype than valuable research.

Editor: Yan