CHINA: STRATEGY: Early 2Q plays

While talk still abounds about a potential RMB revaluation, it will not happen in ’05. China will not be ready for at least 2 years. Most likely scenario for revaluation is 1 year before the Olympics so that their stronger currency will bring in more tourism revenue. Thus counsel lends towards open f/x trades against the RMB revaluation camp.

Recommendations:
China Petroleum & Chemical (Target: HK$4.00)
SinoPec Shanghai Petrochemical (Target: HK $3.50)
China Telecom (Target: HK $3.00)
Yum! Brands (Target: US $55)