Wharf REIC's 1H25 core UNP and DPS rose 3% yoy, despite lower retail rental income, thanks to a 27% yoy decline in finance cost. Its consistently lower net gearing and net debt are highlights. Management remains cautious on the retail and office recovery but aims to continue deleveraging. The company is planning an AEI/redevelopment for Marco Polo Hotel. We raise target price to HK$28.50 to factor in the lower HIBOR. Maintain BUY.
GREATER CHINA Economics Trade: July’s data beats expectations, further near-term strength likely. Sector Automobile: Weekly: YOY PV sales growth remains negative for three straight weeks. Maintain MARKET WEIGHT on the sector. Top BUYs: CATL, Geely and Tuopu. Initiate Coverage Zhejiang Sanhua Intelligent Controls Co (002050 CH/BUY/Rmb27.37/Target: Rmb36.50): Innovative Thermal management leader driving sustainable growth. Initiate coverage with BUY. Target price: Rmb36.50 for A-share, HK$40.00 fo...
Economics Trade July exports grew 7.2% yoy (+1.4ppts), with continued strength in exports to the ASEAN and EU markets. Import growth improved to 4.1% yoy (+3ppt), likely due to a lower base, and support from strong imports of integrated circuits and agricultural products. However, imports of some key commodities saw sharp declines. The Sino-US agreement on another 90-day trade truce may continue to support near-term trade activities. Sector Automobile China’s PV insurance registrations reboun...
Despite a drop in retail sales and a peaking vacancy rate, we saw some positive signals, eg a qoq improvement in per capita spending and resilient restaurant receipts. A lower market rate will reduce landlords’ finance costs, with Wharf REIC set to benefit the most. Upgrade to MARKET WEIGHT and expect a marginal improvement in retail sales in the coming summer. Raise target prices by 8-11% for the stocks under our coverage for a lower risk-free rate. Top pick: Wharf REIC.
In May 25, data from 28 cities and the top 100 developers’ sales point to a mom increase but yoy fall in new home sales. Secondary transactions in 12 cities continued to see a yoy hike. Homebuyers’ sentiments remain weak and divergent among cities, but better supply-demand dynamics lower the urge to introduce strong policies. For Hong Kong, the gentle yoy decline in retail sales and stronger tourist numbers growth are positive developments. Maintain sector ratings. Top picks: CR Land, SHKP and L...
GREATER CHINA Strategy China Property & Hong Kong Property & Hong Kong Landlord Manageable pressure in mainland property market; improved tourism and retail sales momentum in Hong Kong. INDONESIA Strategy Alpha Picks: Good Performances in May Good performances from most with the exception of GOTO and BUKA. MALAYSIA Results CIMB Group (CIMB MK/HOLD/RM6.93/Target: RM7.70) 1Q25: Earnings in line, underpinned by lower provisions. Mai...
The tariffs announced by Trump increased uncertainties over the Fed’s rate cuts, weighing on the recovery of the Hong Kong residential market and tourism. The mainland property market will be less affected, backed by China’s relatively independent monetary policy. For 2025, leading SOE developers’ earnings stabilisation will be a key highlight. Maintain sector weights with this pecking order: China property>Hong Kong developers>Hong Kong landlords. Top picks: CR Land and SHKP.
GREATER CHINA Strategy China And Hong Kong Property & Hong Kong Landlord Tariffs curtail US rate cuts, thereby hindering the recovery of Hong Kong property and tourism; Maintain OVERWEIGHT on China property. INDONESIA Strategy Alpha Picks: Outperform In Mar 25 Remove BBNI, BBRI, ASII, JSMR and KLBF; add BBCA, ICBP, ERAA and BUKA. MALAYSIA Update Pekat Group (PEKAT MK/BUY/RM1.08/Target: RM1.45) Good earnings visibility over 2025...
Wharf REIC’s underlying net profit for 2024 rose 2.1% yoy, mainly thanks to a 10% drop in finance costs. Revenue decreased 3% on a 6% decline at Times Square. Key operational highlights include positive retail rental growth at Harbour City and a higher office occupancy rate. Management's outlook for 1H25 remains cautious. With top-line facing persistent challenges, lower finance costs may be the key profit driver. Trim earnings forecasts and lower target price by 7% to HK$23.10. Maintain BUY.
KEY HIGHLIGHTS Initiate Coverage JBM Healthcare (2161 HK/BUY/HK$1.82/Target: HK$2.42) JBM is a leading branded healthcare provider in Hong Kong with a diversified portfolio. We expect enhanced brand recognition and accelerated e-commerce expansion to fuel future growth and forecast EPS growing at a three-year CAGR of 22.3% in FY25-27. We also like JBM for its solid cash flow generation and decent capital allocation. Initiate coverage with BUY and a target price of HK$2.42 based on 10.3x FY26F ...
GREATER CHINA Initiate Coverage JBM Healthcare (2161 HK/BUY/HK$1.82/Target: HK$2.42) Revitalising iconic pharma heritage brands. Results Wharf Real Estate Investment Co (1997 HK/BUY/HK$20.55/Target: HK$23.10) 2024: Underlying net profit met expectation; lower finance costs being key driver of profits amid top-line uncertainties. Update Jiumaojiu International Holdings (9922 HK/HOLD/HK$3.08/Target: HK$3.00) ...
Property sales in both mainland China and Hong Kong weakened during 2025’s CNY. Another key development around CNY was the change in Vanke’s top management, which we think cannot eliminate the risks associated with Vanke due to the financial constraint of Shenzhen Metro. Hong Kong saw a low growth in tourist arrivals during CNY. We think further policy support is needed and possible. Maintain our respective sector ratings. Top picks are CR Land, SHKP and LINK REIT.
In 2024, Hong Kong saw a recovery in the number of visitors, but per capita spending weakened further. For 2025 we expect a stronger-than-expected Hong Kong dollar to continue to diminish the competitiveness of Hong Kong tourism and shopping, and weigh on the valuation of landlords. Maintain UNDERWEIGHT. Trim earnings for Wharf REIC and Hysan. Lower the target prices for our covered stocks. LINK REIT is our top pick for the resilience of community malls.
A director at Wharf Real Estate Investment Co Ltd bought 30,000 shares at 19.503HKD and the significance rating of the trade was 71/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the ...
In Oct 24, the primary property market showed signs of recovery, with a notable increase in transaction volume. Nov 24 may see a pullback in transaction volume on lower high-quality new supply. However, we still expect a 3% recovery in property prices in 4Q24-1Q25, driven by rising rental yields and supportive macro factors. On the other hand, retail landlords continue to face challenges from GBA integration. Maintain MARKET WEIGHT and prefer developers over landlords. SHKP and LINK REIT are our...
GREATER CHINA Strategy Hong Kong Developers And Landlords Top developer leads strong sales rebound in Oct 24; landlords continue to face challenges from GBA integration. Sector Internet - China Encouraging monetisation visibility from adtech and LLM upgrades. Update Xiaomi Corp (1810 HK/BUY/HK$27.30/Target: HK$31.70) 3Q24 results preview: Robust growth in IoT se...
The Chief Executive delivered the 2024 Policy Address on 17 Oct 24. The government pledged to continue relaxing demand-side policies by expanding new CIES and raising LTV. On the supply front, the government reiterated its land supply plan, and expedite construction in the northern metropolitan area. Policy easing may positively impact the market in the near term. However, restoring confidence and further rate cuts are crucial. Maintain MARKET WEIGHT. SHKP and LINK REIT are our top picks.
The CCL index fell 7.71% in 9M24. We anticipate a 3% rebound, supported by both rate cuts and China's economic stimulus policies. For the Golden Week holiday, the first six days registered a 24% yoy growth in the number of mainland tourists, with F&B being the major beneficiary. However, the relatively high Hong Kong dollar exchange rate may continue to weigh on high-end tourism spending. Maintain MARKET WEIGHT, preferring developers. Our top picks are SHKP and LINK REIT.
GREATER CHINA Sector Hong Kong Developers And Landlords Expect the strong performance of the stock market to have a positive impact on property prices. INDONESIA Update Summarecon Agung (SMRA IJ/BUY/Rp700/Target: Rp865) Potential further re-rating from SMIP IPO and more rate cuts. MALAYSIA Update KPJ Healthcare (KPJ MK/HOLD/RM2.07/Target: RM1.90) KPJ’s transformation programme continues to gathe...
GREATER CHINA Strategy Alpha Picks: September Conviction Calls: We expect an improving operating performance among selected companies in September, and add AIA, COLI, Desay SV, Galaxy Entertainment, Meituan, Ping An and TUL to our BUY list and add Li Auto as a SELL. INDONESIA Strategy Alpha Picks: Trailing The JCI’s Strong Performance In Aug 24: Our picks are ICBP, TOWR, BBNI, BMRI, BBRI, EXCL, CTRA, BBTN, CMRY, SIDO and JSMR. MALAYSIA Strategy Alpha Picks: Adapting To A Bipolar Market: Our Al...
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