Daiwa Research raised its target price for Sino Land (00083) to HK$15.3 from HK$14.3, and upgraded its rating to "buy" from "hold".
The research house said primary property market sales in have continued to do well in recent weeks, auguring well for the Sino Land consortium's Dragons Range project (a prominent project in the Kau To area in Shatin), which it believes will likely be launched in 4Q14.
Daiwa believes the Kwun Tong site recently bought by Sino Land as a positive step in its landbank replenishment as the project is large enough (GFA over 2m sq ft) and the terms look reasonably attractive. It should reduce the risk of Sino Land potentially being caught in a difficult situation whereby its landbank might have shrunk to an insufficient level yet the land market might have turned more competitive.
Moreover, Daiwa considers Sino Land has a fair probability of achieving further progress in coming months as several major sites will be for sale in the coming months. Examples include Lohas Park Package 5 (over 1.5m sq ft) and a site in Pak Shek Kok (0.72m sq ft).
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