Bank of America Merrill Lynch is optimistic. Henglong Changshi Hengdi

Bank of America Merrill Lynch is optimistic. Henglong Changshi Hengdi

Bank of America Merrill Lynch pointed out that after an average rebound of 35% in the fourth quarter of last year, local property stocks have almost surpassed the increase in 2016 (the property market also showed a similar bottoming out), and the bank believes that the current valuation has roughly reflected Recent positive factors, including the suspension of interest rate hikes, the reduction in private land supply, property prices and the recovery of transactions, are more optimistic about the stocks with unique positive catalysts and higher growth prospects.

Residential property prices rose by 5%

Bank of America Merrill Lynch said that after adjusting the residential property prices in Hong Kong from 5% to 10% in January-February, the bank is expected to stabilize in March, so the residential property price forecast will be raised from 5% to 10%. 5%, mainly benefited from the US Federal Reserve’s move to doves and the mainland’s credit environment is loose. At the same time, Hong Kong stocks have risen 17% so far this year, which is also good for property prices. The bank’s office rent forecast was raised from a flat to a maximum of 3%. Driven by the appreciation of the renminbi, the forecast for high-end retail tenant sales also fell by 5% to 10%, adjusted to 5% to 8%.

The Bank’s preferred shares include Hang Lung Properties (101), Cheung Kong Group (1113) and Henderson Land (012). The target price was raised to $24, $81 and $56.5 respectively. The ratings are all “buy". The bank is optimistic about the development of Hang Lung Properties in Shanghai. The rental income increased by 22% from 2018 to 2021, and the earnings per share forecast for 2019-2021 was increased by 17% to 18%. As for Cheung Kong, it will lock in high profits this year, while Henderson is the main beneficiary of the “Land Sharing Pilot Scheme".

The ratings of the Group’s (083) and New World (017) are also “buy". The target price has risen to $16.9 and $16. The target price of SHKP (016) has slightly increased from $142 to $146. Sex" rating.

The rating of Champion REIT (2778) was lowered from “Buy" to “Neutral". The main reason is that the share price has already reflected the potential strong increase in the rent of “Garden Road No. 3″. The predicted interest rate of 4.3% is not particularly attractive.