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小摩:下调长实集团评级至“中性” 目标价降至34.5港元

Xiaomo: Downgraded Changshi Group's rating to “neutral”, and the target price was reduced to HK$34.5

新浪港股 ·  Mar 22 04:13

J.P. Morgan Chase released a research report stating that the rating of Changshi Group (01113) was downgraded from “overholding” to “neutral”, and the target price was lowered by 23% from HK$45 to HK$34.5. The bank expects that the Group's property development business will continue to be weak in 2024, and profits are expected to rebound strongly in the 2025 fiscal year.

According to the report, despite the company's earlier “stable dividend” guidelines, Changshi still cut the dividend per share by 10%, which is surprising. This weakened investors' confidence in the visibility of future dividends, so the company's rating was downgraded. There is also no catalyst in sight in the short term. Even though some investors have a positive view of Hong Kong housing, Changshi is not as good as Henderson Land (00012) and Sun Hung Kai Properties (00016) in terms of investment. Motong expects a negative initial stock price reaction, and then the stock price may fluctuate in a range.

The bank said that due to a decrease in property sales accounts, the group's profit margin has also decreased. Net profit from continuing operations decreased by 10% year-on-year in fiscal year 2023. Excluding fair value changes and one-time projects, core profit decreased 20% year over year. SHKP's dividend cuts were based on being cautious about the outlook for the housing market before canceling the “hot move,” while Changshi management said that the dividend cuts were driven by a conservative economic outlook, and the economic outlook remained positive even after policy relaxation. Although management mentioned that share buybacks may be another way to increase shareholder value, as there are no specific goals, Motong believes this will not offset investors' disappointment that the dividend per share did not meet expectations.

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