What the broker said...
New World Development develops and invests in real estate, manages hotels and provides construction, infrastructure and telecommunications services.
A Pacific Challenge report from a year ago maintained a 'hold' recommendation on the company's stock after reported net profit to the end of June, last year was HK$215 million, compared with HK$1.32 billion for the previous year.
The result looked bad at the time but was a significant improvement over the six-month interim result at the end of December, 1999 which revealed a reported loss of HK$907 million.
The group reported HK$27 billion net debt, but it was trying to reduce it by disposing of its interest in the Regent Hotel and selling down its telecoms business.
The brokerage felt a successful disposal of non-profitable assets would be a catalyst for outperformance, but pointed out timing was difficult to predict.