Tianjin Development Holdings is the listed vehicle of the city's government, with products ranging from consumer goods to port businesses and industrial machinery.
One year ago, ING Barings placed a a buy recommendation on the stock, which proved to be poor advice as the company not only underperformed the Hang Seng Index but would have brought investors negative returns of 36.99 per cent.
Over the same period, the Hang Seng Index increased by 31.98 per cent.
In making its recommendation, Barings said the company was a safe bargain as it had a cash pile of 900 million yuan (about HK$837.45 million), which made it stand out in the debt-prone red-chip sector.
Infant businesses such as the Dynasty winery should provide substantial growth in coming years due to rising demand for dry wines. Its road infrastructure operation was expected to provide stable income.
Yet Barings, in its report last year, conceded that Tianjin Development Holdings was already suffering from the Asian crisis, which had hit its operations in ports and elevators.