Vanda Systems & Communications Recommendation: Buy Brokerage: Nomura VANDA Systems is engaged mainly in systems integration for computer projects as well as distributing PCs and computer peripherals. Only one-third of China's banks are computerised, leaving a vast potential market, and as Vanda has a sound track record it is positioned to benefit. The company's 75 per cent-owned telecoms unit Comtech also is ready to enter the mainland, being in negotiations for contracts worth about $800 million. Vanda is expected to show unexciting growth of about 15 per cent to August 31, but get back on track in 1999 due to the mainland's robust demand. Hongkong & Shanghai Hotels Recommendation: Sell Brokerage: OCBC Securities HONGKONG & Shanghai Hotels is engaged principally in hotels and property, its key assets including The Peninsula Hotel and the Kowloon Hotel, both in Tsim Sha Tsui. The company confirmed last week it had reduced rents for tenants in the Peninsula and Kowloon hotels' shops by 15 per cent from April 1, which could mean a 5 per cent cut to net profits. Weak tourism also is expected to cause a 10 per cent profit drop. Cafe de Coral Recommendation: Buy Brokerage: Indosuez WI Carr CAFE de Coral operates fast food and specialty restaurant chains in Hong Kong and the mainland. Its business is holding up well despite the slowdown as it benefits from diners moving from dim sum restaurant lunches to fast food. Cafe de Coral also is benefitting from cost controls, closure of poor-performing stores, and efforts to seek promising locations. CLP Holdings Recommendation: Buy Brokerage: Nikko Research Center CLP Holdings is engaged in generating and supplying power to Kowloon and the New Territories. The company recently announced financing for the 3,220 megawatt project in Shandong province. This news should be positive for sentiment and provide an extra $440 million net profit by 2004. The company also has said it might pay a special dividend to shareholders from its cash reserves if it cannot find suitable investments.