Hong Fok

Hong Fok: The redevelopment of International Building, which involves an extension of a single storey commercial block and conversion of exsting car park block into a new 27-storey 576-room hotel in the prime Orchard Road shopping belt, is expected to yield a significant revaluation surplus for the group once it is completed. The group has paid a development charge of $63.5m to the URA in 1Q13 to effectively double its gross floor area from 15,267 sqm to 31,150 sqm. A revaluation of the new International Building complex is likely to boost its current book value of $1.71 and further support the share price. At $0.70, Hong Fok trades at a compelling 0.41x P/B.