CLSA upgraded 1200.HK to buy from sell, raising its target price by 24 per cent to HK $4.70, or 10 times fiscal 2013 earnings.

According to CLSA, Wachovia is a more direct beneficiary of the government's new "home ownership" policy than other property developers. However, Wachovia has had a modest impact on earnings because only 1/3 of the company's revenue comes from the secondary market, and the positive impact has been further diluted by the company's declining share of the lower-end housing market. In any case, Wachovia's earnings cycle is clearly off the hook, and the chairman of the company is reassuring to buy shares.