WHEN Cheung Kong announced its thumping great profit rise of 56 per cent on Thursday, most people were too busy applauding to look at what was happening with the company's land bank.
Land being the sustenance of all Hong Kong developers, Cheung Kong, like any other, likes to keep its supply topped up and a very good way is the practice of buying agricultural land.
The land may not be for property development use, but it could end up receiving an exchange entitlement allowing it to be developed in the future.
To date, Cheung Kong has not held such land, preferring to stick with another sort zoned for development. But recently, sources said, the developer has been a big buyer of agricultural strips out in the New Territories.
Holding agricultural land is always a game for the big boys since much time and effort is required to convince the Government of the desirability of ripping up cabbages and replacing them with tower blocks.
Not only that, it requires a strong balance sheet to keep non-performing assets with only the vaguest hope that an exchange entitlement will be granted.
Perhaps Mr Li has realised that after making so much money in securities disposals and trading during 1993, a more cautious strategy was called for in 1994.