Junius
Long/short equity, medium-term horizon, value, growth

New World Development Trades At Less Than Half Book Value, Despite Strong Profit Growth And Diversification

New World Development ("NWD") (OTCPK:NDVLY) (0017.HK), headquartered in Hong Kong, is a major property developer in Hong Kong and China. In addition to property development and rental investments, the company also has interests in hotels, infrastructure, retail and telecommunications. NWD is therefore a very typical Hong Kong conglomerate, with wide ranging business interests, but with a focus to property development. Similar conglomerates include: Cheung Kong Holdings (OTCPK:CHEUY) (0001.HK), Hopewell Holdings (OTCPK:HOWWY) (0054.HK), Henderson Land Development (OTCPK:HLDCY) (0012.HK) and Sun Hung Kai Properties (OTCPK:SUHJY) (0016.HK).

NWD shares have fallen by more than 19% over the past year, despite seeing net profit rise 40% to HK$14.1 billion ($1.83 billion) for the financial...

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