Bank of America Securities released a research report stating that in the “buy” rating for Hysan Development (00014), the target price was lowered from HK$17.2 to HK$16.5, reflecting a reduction in the NAV forecast per share, and a 4% to 7% reduction in the earnings forecast per share for the current year and next two years, as accounts for the Lam Hai Shan Shing project in Tai Po were slower than expected.
According to the report, the company's performance last year fell slightly short of expectations, and the dividend per share was reduced to 1.08 yuan, which is equivalent to a dividend ratio of 61%. Management reiterated a steady increase in future dividends. The bank believes profits have bottomed out and expects retail revenue to increase by 6% this year to offset the decline in office rents. Hysan Development's stock price is equivalent to a 74% net asset value (NAV) discount per share and a dividend rate of 8.2%, which is an attractive level.