Citigroup raises MIDEA REAL EST target price to 5.9 yuan, maintains "Buy" rating

Citi's research report indicates that MIDEA REAL EST (03990.HK) has a net cash of RMB 1.27 billion, and management expects revenue and profit to grow by 20% in the next two years, with a dividend payout ratio of 70%.

The bank believes that MIDEA REAL EST's profit growth target for 2025 is achievable, as the project management business will contribute throughout the year. The current valuation is significantly lower than the average level of 11 times in the property management industry. The bank maintains a "Buy" rating on the company, raising the target price from HKD 4.8 to HKD 5.9, equivalent to a projected price-to-earnings ratio of 10 times for 2026