Lyon lowered Hysan's (00014) profit forecast for this year and next two years by 18.1% and 23.1%.
The Zhitong Finance App learned that Lyon released a research report stating that Hysan Development (00014)'s profit forecast for this year and next two years was lowered by 18.1% and 23.1%, reflecting a reduction in sales and profitability assumptions for its shared housing project. The target price dropped from HK$20.3 to HK$14.2, and the rating was downgraded from “buy” to “outperform the market.”
The bank indicated that due to the weak office market and the refurbishment of the retail property portfolio, Hysan's recurring basic profit fell 11.2% year over year. I was also disappointed with Hysan's 25% cut in dividends, but understood management's concerns about the business challenges. Furthermore, it was mentioned that management intends to maintain a stable and progressive dividend payment policy after cutting dividends. The bank believes that the current 60.5% dividend ratio is similar to before the pandemic, and believes it is more sustainable.