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Strong Week for Hysan Development (HKG:14) Shareholders Doesn't Alleviate Pain of Five-year Loss
Morgan Stanley: It is expected that Hong Kong's retail sales will decline by 5% in 2025, with a preference for LINK REIT in related property stocks.
Morgan Stanley released a Research Report stating that Hong Kong's retail sales recorded a year-on-year decline of about 10% in December, worse than the 7% decline in November, despite the opening of "multiple entries with one visa" in Shenzhen. Morgan Stanley expects a 5% decrease in Hong Kong's retail sales in 2025, predicting that the depreciation of the renminbi and the weak Hong Kong economy will offset the positive impact of "multiple entries with one visa", preferring LINK REIT (00823) and others. Morgan Stanley indicated that retail-related property stocks include WHARF REIC (01997), LINK REIT (00823), and HYSAN DEV (00014), which are expected to underperform the Hang Seng Index by 42-43 percentage points in 2024 and in 2025.
Morgan Stanley: Expect a 5% decline in Hong Kong retail sales in 2025, preference for related Property/A-REIT stocks, particularly LINK REIT (00823).
The action is to rate Link REIT as "Shareholding", while maintaining "Shareholding" for WHARF REIC and Hysan Development.
[Brokerage Focus] Morgan Stanley expects a 5% decline in Hong Kong's retail sales in 2025, with the depreciation of the renminbi potentially offsetting the positive effects of "multiple entries with one visa".
Jinwu Financial News | Morgan Stanley's research report indicates that Hong Kong's retail sales recorded a year-on-year decline of about 10% in December, worse than November's 7%, despite Shenzhen opening up the "one signature multiple trips" policy. Morgan Stanley predicts a decrease of 5% in Hong Kong's retail sales in 2025, believing that yuan depreciation and a weak Hong Kong economy will offset the positive effects of the "one signature multiple trips" policy. It prefers LINK REIT (00823) among others. Morgan Stanley points out that retail-related property stocks like WHARF REIC (01997), LINK, and HYSAN DEV (00014) could underperform the Hang Seng Index by 42-43 percentage points in 2024, as of the beginning of 2025.
DBS: Maintains HYSAN DEV "Buy" rating with the Target Price adjusted to HK$14.38.
DBS has released a research report stating that it maintains a "Buy" rating for HYSAN DEV (00014), with the target price adjusted from HKD 15 to HKD 14.38, believing that the stock price has already reflected negative factors. The report states that as the portfolio expands and renovation projects are completed, HYSAN DEV's rental income will improve. After the complete renovation of Lee Gardens, HYSAN's luxury retail property portfolio will have more than 10 renovated and expanded flagship stores, with a 40% increase in occupied area compared to before. Additionally, DBS states that the rental contribution from Lee Gardens in Shanghai, acquired by HYSAN in 2021, continues to grow, with the office pre-leasing commitment rate rising to about 80%. Furthermore, Lee Gardens 8
DBS Sticks to Its Buy Rating for Hysan Development Co (HYSNF)
