Tai Fook Securities maintains Tianjin Development's (0882.HK) buy rating with a target price of HK $5.80.

Dafu Securities said Tianjin Development had significant potential to be rerated because even taking into account the discount of the holding company (21 per cent of 3382.HK and 44.8 per cent of 0828.HK), the present value of the stock is only 0.3 times the book value of unlisted assets.

Dafu Securities added that Tianjin Development would receive an one-time income of about HK $1 billion by restructuring its port business, while the company's foreign exchange reserves of HK $332 million in its toll road assets would also be recognised as income in fiscal year 2010.

Dafu Securities said that Tianjin Development, the most diversified red chip, intends to follow the example of its listed peers and focus on operating in one industry, indicating that the company is about to restructure its assets. Tai Fook Securities believes that this will lead to an increase in the value of the stock as key growth drivers will be identified; divestment of non-core businesses is also likely to achieve greater value of underlying assets.

The stock closed down 5.4 per cent at HK $4.04.