CITIC Securities released a research report stating that it maintains the New World Development (00017) “buy” rating, and considering that the company's business structure has undergone major adjustments, the company's core EPS forecast for the 2024-2026 fiscal year was adjusted accordingly to HK$3.53/3.55/4.27, with a target price of HK$11. In the first half of fiscal year 2024, the company completed the sale of newly created shares. The two major sectors of continuous operation, property development and property investment, performed well and had outstanding profitability. Retail consumer traffic in Hong Kong and mainland China picked up, and property sales support policies continued to be introduced. We expect the company to achieve steady development based on the new business.
According to the report, the company announced its results for the first half of the 2024 fiscal year. In the first half of fiscal year 2024, the company achieved gross profit of HK$7.26 billion, +2% year-on-year, corresponding gross profit margin of 43%, and achieved a core net profit of HK$4.87 billion, +12% year-on-year, corresponding to a core net interest rate of 29%. In addition, the company also announced an interim dividend of HK$0.2 per share. Among them, in the first half of the fiscal year 2024, the company's property investment division achieved revenue of HK$2.67 billion, +12% year over year, and achieved segment performance of HK$1.75 billion, or +14.3% year over year. During the reporting period, the company K11Musea and K11Art Mall performed well. Sales increased 41% and 29%, respectively, and passenger traffic increased 39% and 19%, respectively, and occupancy rates remained close to full rent. According to the company's financial report, in the next few years, the company will continue to open a number of investment property projects, which are expected to continue to contribute to the increase in reported profits.