Goldman Sachs published a report that gave Tianjin Development (00882-HK) a purchase rating for the first time. The target price was set at HK$4.70, which is equivalent to 5.3/0.6 times the price-earnings ratio/market account ratio in 2012.

According to the report, the stock is discounted 66% from the 2012 net asset value forecast (HK$10.3). The valuation is attractive. As the company strives to streamline its business, the relevant discount can be gradually narrowed. Goldman Sachs also said that Tianjin is developing 2 billion Hong Kong dollars in cash on hand, which is equivalent to about 50% of its current market value; in addition to the increasing contribution of its lift, port, and alcohol business, the prospects are attractive.

Tianjin Development closed at HK$3.61 yesterday.