Credit Suisse lifted its target price for Sun Hung Kai Properties (SHKP)(00016) to HK$153.14 from HK$151.2 and maintained its "buy" rating.
The research house said SHKP's FY2019 results were largely in line. Contracted sales in HK in FY2019 increased by 43.5% to HK$59.7bn. Management believes that such level is not sustainable and has set FY2020 sales target at HK$40bn/HK$7.5bn for HK/China.
Despite weaker demand for office, management believes that tight supply in core areas cushions the downside risks and sees no trend for MNC (multinational corporation) to leave HK. While retail sales in HK have been hit hard, management believes that rents in well-managed malls are less impacted than street shops.
Credit Suisse lowered its FY2020/21 earnings by 1%/2% as it fine-tuned the completion schedule.
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