Termbray Industries International Recommendation: Sell Brokerage: Deutsche Morgan Grenfell TERMBRAY Industries manufactures printed circuit boards for the computing, telecommunications and automotive industries.
Speculation about the spin-off of the company's US division drove the share price to extreme highs late last year and even now the counter looks expensive.
Termbray has closed its Hong Kong facilities in Tsuen Wan and moved machinery to Guangzhou. The disruption is likely to hurt operating margins this year.
While margins should improve in 1998 and 1999 due to lower labour and direct overhead costs in China, competitors such as Elec & Eltek offer better value.
Sun Hung Kai Properties Recommendation: Buy Brokerage: ABN-Amro Hoare Govett Asia SUN Hung Kai is a property developer with interests in hotels, manufacturing, telecommunications and parking management.
The counter presents a good buying opportunity after lagging rivals Cheung Kong and New World Development in the recent rally.
Sun Hung Kai's large and mature farmland reserve will ensure continual superior profit margins.