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2008-5-30 03:46:00 p.m. HKT, XFNA
BROKER CALL Hong Kong's New World Devt raised to 'overweight' - Lehman Brothers
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HONG KONG (XFN-ASIA) - Lehman Brothers said it has upgraded New World
Development (NWD) to "overweight" from "equalweight", but cut the target price
to 25.75 hkd from 27.50.
The new target still offers more than 30 pct upside from the property
developer's current price.
"We believe NWD's 33 pct correction year-to-date is excessive and more than
reflects the 1-28 pct
correction of its listed subsidiaries," Lehman Brothers said.
The brokerage expects to see good pre-sales at the company's two key
residential projects Wylie Court and Hanoi Road in the second half of the year.
It raised New World's net profit forecasts for 2008, 2009 and 2010 by 14 pct,
32 pct and 30 pct respectively, to 5.56 bln, 5.87 bln and 5.16 bln hkd.
"While earnings have been marked up, our end-09 net asset value sees a 7 pct
decline to reflect the decreased market value of (units) New World China, New
World Department Store, and NWS Holdings," it said.
At 3.37 pm, New World Development shares were up 0.6 hkd or 3.2 pct at 19.36.
(1 usd = 7.8 hkd)
roby.lau@xfn.com
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