[ET Net News Agency, 9 February 2018] Deutsche Bank expects to see little excitement in
the upcoming results season for the Hong Kong property sector, as stronger-than-expected
ASPs achieved in primary projects sold in FY2017 will not be reflected until FY2018.
Moreover, as the dividend hike has generally outpaced growth in the corresponding
recurring income over the past few years, the sector payout ratio already reached a high
49% in FY2016 and recurrent profit as a percentage to dividend fell to 108% (117% in
FY2014; 111% in FY2015). Hence, DB believes this will hinder the scope for further
dividend hikes.
The research house revised its target prices for the developers it covers as follows:
Name Rating Target Price
------------------------------------------------------
SHKP (00016) Hold HK$122.3 to HK$130.7
CK Asset (01113) Buy HK$69.3 to HK$79.5
MTRC (00066) Hold HK$42.6 to HK$41
Wharf REIC (01997) Hold HK$46.2 to HK$51.2
New World Dev (00017) Hold HK$11 to HK$12
Sino Land (00083) Hold HK$14.4 to HK$14.2
Wharf (00004) Hold HK$30.5 to HK$31.7
Kerry Prop (00683) Hold HK$30 to HK$33.5
Hysan Dev (00014) Sell HK$32.3 to HK$33

(KL)