DESPITE Bank of East Asia reporting strong 46.8 per cent growth in profits, its share price fell $2 to $55. Instead the beneficiaries seemed to be HSBC Holdings and Hang Seng Bank which rose $4 and $1, respectively, to close at $108 and $72. Analysts are having a hard time convincing themselves that a 46.8 per cent increase truly reflects the fundamental growth of the bank. While the figure cannot be taken at face value, market practitioners believe the industry's growth momentum will be maintained, raising hopes that Hongkong Bank and Hang Seng Bank will post relatively good results next month. Salomon Brothers analyst Alvin Chong reckoned the bank's core growth would be 25 to 26 per cent. ''Stripping off the likely return on the interest-free funds raised in November 1992 - which was about HK$1.85 billion - the profit should be around $860 million, much in line with the industry's growth,'' he said. The picture was more puzzling when analysts recalled the bank's disappointing interim profit growth of only 21.8 per cent, which also included the returns generated from the interest-free funds raised in November. ''The core growth was only six per cent in the first half after discounting that factor,'' Mr Chong said. Apart from the return on the interest-free funds, the strong growth can also be attributed to the strong stock market rally in the second half of last year. ''The bank might have generated much income from its treasury and securities trading, benefitting from frantic market activity,'' said Tony Liu, associate director at DBS Securities. A significant rise in fee income from trust business and good cost control were two other contributory factors, said John Doyle, investment analyst at MeesPierson Securities (Asia). Analysts tend to agree that the bank has a track record of manipulating its interim results. ''This year, there was pressure on the management to give out a better result due to its 75th anniversary and the enlarged share capital arising from the placement in 1992,'' Mr Doyle said. Sun Hung Kai Securities banking analyst Andy Kong, whose forecast was for a bullish 60 per cent growth - taking into account that it was the bank's 75th anniversary - was convinced the bank's stated figure was artificially pushed up. ''The bank might have realised some long-term investments,'' he said. But, taking out the factor that a good figure was required for the 75th anniversary, he said his original prediction would have been a 30 per cent increase. But the market, which has long been expecting the bank to present good results and a cash bonus in anticipation of its 75th anniversary, did not respond favourably yesterday. ''The bank's share price has gone up quite a lot in the past few months, almost 60 per cent compared with July last year. The good news has been discounted,'' Mr Liu said. Although analysts were busy adjusting upwards their profit forecast for the bank in 1994, few switched their recommendations from sell or hold to buy, despite the lure of profit growth. ''Even though the PE for 1994 will drop to 25 times, calculated on a $2.20 earnings per share figure, it is still too high,'' Mr Doyle said, adding that he adjusted the profit forecast from $1.06 billion to $1.27 billion for 1994. The bank's high price-earnings multiple, standing at 38.25 times on Friday's close of $57, is well ahead of the market PE of about 21 times.