Bank of China International raised the target price of Shenggao Land (0337.HK) from HK$6.10 to HK$6.40 because it raised its forecast for the net asset value of Shenggao Land, but maintained its purchase rating for the stock because the stock's valuation was attractive (62% off the net asset value per share, which is equivalent to 5.3 times the expected earnings per share for FY2010). Bank of China International expects Shenggao Land's profit to soar in 2010. Previously, Shenggao Land announced that its core business profit for the 2009 fiscal year soared more than fivefold to RMB 320 million, thanks to an increase in the sold and delivered construction area (167% to 310,000 square meters). Bank of China International said that Shenggao Land's gross profit margin was lower than expected, but it is expected that the company's gross profit margin in 2010 will rise by more than 30% due to an increase in the average selling price obtained from contract sales in 2009. Considering that Shenggao Land's contract sales in January reached RMB 1 billion, BOCI believes that Shenggao Land has already set about 80% of this year's sales target. Bank of China International added that Shenggao Land's financial situation has improved, its net debt ratio has dropped to 18%, and cash on hand has reached RMB 5.4 billion. Shenggao Land rose 5.25% to close at HK$4.81 on Friday.