UBS: Target price of HK$102 for a “buy” rating for Sun Hung Kai Properties (00016)

The Zhitong Finance App learned that UBS released a research report stating that SHKP included Sun Hung Kai Properties (00016) in the list of preferred stocks, believing that SHKP is in a good position to recover in the housing market and can benefit from continued rising rents, population inflows, and falling mortgage interest rates, giving it a “buy” rating, with a target price of HK$102.

The new “Policy Address” proposes to further relax the upper limit of residential mortgage ratio of 30 million yuan or more to 70%, and to include luxury property investments worth 50 million yuan or more in the new capital investor entry plan. The government has also introduced measures to encourage the conversion of hotels and commercial buildings into student dormitories, which is believed to have a positive impact on the Hong Kong real estate market and developers.

As for the banking sector, the bank believes that the Policy Address is slightly beneficial to the Hong Kong banking industry, but it still maintains a cautious view on the Hong Kong banking industry. It believes that during the US interest rate reduction cycle, banks' net interest spreads will be under pressure, and the risk of non-performing loan ratios will also rise.