Citigroup maintained the purchase rating of Hop Sang Innovation Group (0754.HK) and raised the target price from HK$15.47 to HK$19.41, based on a 40% discount compared to net asset value. Previously, the estimated base period was extended to FY2010. Citi pointed out that the company's basic core profit for fiscal year 2009 increased 31% from the previous year to HK$2,274 billion, slightly lower than the market's forecast of HK$2.39 billion because management expenses were higher than expected. Citibank also said that the company's contract sales so far this year have increased 36% to RMB 3.3 billion; the bank said it believes the company will achieve its 2010 sales target of RMB 20 billion. Citi lowered its earnings forecast for the 2010 and 2011 fiscal years by 1.9% and 9.7%, respectively. It mainly took into account the latest sales and completion schedule, and adjusted the average sales price forecast according to the general market environment. Citi pointed out that the stock's valuation is equivalent to 6.4 times the projected price-earnings ratio for FY2010, with a 62% discount compared to the estimated net asset value for FY2010; as one of the real estate companies with the best land reserves, the stock's intrinsic value was ignored. Hopson Innovation Group closed at HK$12.24, down 2.55% yesterday.