BNP Paribas Affirms “Buy” on Hong Kong’s Hopewell Holdings

Hong Kong – BNP Paribas reaffirmed its “buy” rating on Hopewell Holdings Ltd. (00054.HK), and its target price for shares of the Hong Kong-based infrastructure and property developer at HK$27.20, in a research report issued on February 27.

Hopewell’s toll road revenues in southern China have resumed strong growth since January, recovering from a localised downturn resulting from traffic restrictions imposed during the Guangdong Asian Games last November, it said.

BNP Paribas predicted that Hopewell’s full-year current earnings would increase to HK$588 million, or by 6%, after subtracting special items such as earnings of properties revaluation.

The report said the compound annual growth rate of rentals for the company’s properties from 2010 to 2012 would reach 10%, partly as a result of the monthly rent of its flagship Hopewell Centre headquarters in Hong Kong increasing to HK$35 per square foot, a rise of 13% on the year.

The first stage of the Hopewell Centre’s approximately HK$140 million renovation project was completed in January.

The Wen Wei Po quoted Leung Bik Si, Director of Hopewell Assets Management Company, as saying new value-added facilities and services had helped boost the building’s leasing rate to 91% and rentals had increased by about 20% over the previous six months.