Bank of China International maintains the Senggao Land (00337-HK) purchase investment rating, with a target price of HK$7.

Bank of China International released a research report today, saying that Shenggao Land's contract sales revenue in April this year was very strong, reaching 925 million yuan, mainly due to strong new property sales in Kunming. 70% of sales revenue during the period came from the Kunming Dacheng Project. The company's contract sales revenue from January to April this year reached 2.56 billion yuan, 340% higher than the same period last year, and locked in more than 80% of its profit forecast for FY10.

The report indicates that for the rest of this year, the Bank of China believes that the company's sales growth will mainly come from the Suzhou Global 188 Project and the Wuxi West Shuidong Project. Both projects are high-end real estate, and the bank expects to lead housing prices in Suzhou and Wuxi in the future. Although high-end projects may fall victim to the austerity period, even if contract sales fall 30% this year, after completing the acquisition of the three projects at the beginning of the year, the company will still have 2.7 billion yuan in cash at the end of the year.

Senggao Land closed at HK$3.87 for the full day.