UBS raises New World Development's target price to HKD 136, maintains "Neutral" rating

UBS published a research report indicating that Sun Hung Kai Properties (00016.HK), as a major developer in Hong Kong, could benefit from the recovery in the property market. However, it believes that the strong factors driving the market recovery have already been reflected in the stock price. At the same time, the bank believes that the continuous recovery of property prices (it expects a 10% increase over the next two years) and the rebound in transaction volume may continue to support the stock price and the company's earnings.

The bank expects Sun Hung Kai Properties to achieve a profit of HKD 11.4 billion in the first half of the 2026 fiscal year, representing a year-on-year growth of 9%, with the interim dividend remaining unchanged. Additionally, the bank stated that since Sun Hung Kai Properties has 6,550 units available for sale, coupled with a significant increase in recent property prices, it expects the company's earnings to grow by 20% year-on-year in 2027, with dividends expected to rise by 10%.

The bank raised its target price for Sun Hung Kai Properties by 40%, from HKD 96 to HKD 136, and adjusted its earnings forecast for the fiscal years 2027 to 2028 upward by 11% to 12%, maintaining a "Neutral" rating