Hong Kong Land Recommendation: Hold Brokerage: Morgan Grenfell Asia Hongkong Land's full year rental is expected to be flat, in the absence of Number 9 Queen's Road Central's contribution in the second half. Strong Grade A office take-up of 2.41 million-square-foot in the first six months outstripped new supply of 2.21 million, and bodes well for rental revisions in the coming year. Central office rents climbed 15.3 per cent in the first eight months, with asking rents ranging from $60 to $66 per sq ft for good quality offices. That still compares well with $55 per sq ft in Admiralty and $45 in Causeway Bay. Office capital values have also gone up 30 per cent. The latest asking price starts from $14,000 per sq ft. Trafalgar House results will be equity accounted in the current year, for a six month period ending in September. After the HK Land buy-in, the company has focused its business on core construction activities and made significant inroads into new marketsin Asia. A 63,000 sq ft office joint venture project in Hanoi is scheduled for completion in 1995, with total investment of US$7 million ($54 million). Giordano Holdings Recommendation: Reduce Brokerage: Morgan Grenfell Asia Growing competition has lowered the profitability of Giordano Holdings' Hong Kong operations, forcing it to look elsewhere for earnings growth. The operating margins setback is likely a permanent one, as its successful operating strategies are increasingly copied by others. Prospects in Taiwan and Singapore, where Giordano still holds its competitive edge, look brighter. However, its retailing foray into Australia and New Zealand would incur start-up costs in the near future. New World Development Recommendation: Buy Brokerage: Schroders Securities New World Development's wholly-owned subsidiary, NW China Investment, is going to seek a listing in Dublin through the placement of a maximum 200 million shares to independent investors at US$10 each. New World Development will hold not less than 37.5 per cent in NW China after listing. The issue will help reduce New World's debt level and spread the risks in its China investments. Shareholders will also be granted an option enabling them to put their shares in return for new shares in New World Development. The maximum number of new shares in the company that can be issued is 97.66 million. Initially, this new company's investment portfolio will involve six major projects valued at around US$83 million. These include two major highways, a power station and two property developments. More projects are expected to be injected into the new company by New World in the short term. New World has a relatively large exposure to China when compared to other major developers in Hong Kong. Currently it has a land bank of 26 million sq ft in China, which is over four times larger than in Hong Kong.