According to a research report published by UBS, Hysan's core profit for the last year fell 17% year-on-year to HK$1.39 billion, lower than the forecast. Hysan's final dividend of HK81 cents per share decreased by 31% year-on-year. The dividend for the full year was HK$1.08 per share. That is, the dividend ratio fell from 88% to 80%, which was also lower than UBS's expectations. UBS pointed out that Hysan's debts of HK$158 million and HK$2.8 billion will be due this year and next, respectively. There are plenty of cash on hand and unwithdrawn revolving loans. It is believed that related debts can be repaid. After the final dividend cut, it is expected to achieve a positive operating cash flow of HK$308 million in 2023.
Considering that Lee Garden's asset enhancement project has been completed, the bank believes that Hysan's rental income growth is supported. Currently, it predicts that the dividend per share will remain unchanged in 2024, but reminds that continued capital expenditure of HK$2 billion per year may further boost Hysan's net balance ratio until 2026. After comparing interbank dividend rates, UBS anticipated that Hysan's dividend cut would have a negative impact on the stock price and lowered the target price from HK$26.3 to HK$23.8, giving it a “buy” rating.
大行评级｜瑞银：下调希慎目标价至23.8港元 盈利及派息不及预期
Major Bank Ratings | UBS: Lowering Hysan's Target Price to HK$23.8 Profit and dividends fell short of expectations
Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more