CK ASSET(HK:01113) Hua Xia Shi Bao·2025-07-31 06:30Core Viewpoint - Recently, Cheung Kong Holdings Limited launched the "Greater Bay Area Dual Residence Life" property plan in Hong Kong, focusing on selling four residential projects in the Greater Bay Area, which has attracted significant market attention [2][3]. Summary by Sections Project Details - The total number of units for sale is nearly 400, with an entry threshold of approximately 400,000 RMB per unit [2][3]. - The projects included in the plan are Huizhou Longpo Garden, Dongguan Haiyi Haoting, Zhongshan Longpo Garden, and Guangzhou Yicui Manor, most of which were acquired at low prices many years ago [3][5]. - The pricing of these properties has seen significant reductions, with Dongguan Haiyi Haoting's average price dropping to 15,000 RMB per square meter, nearly halving from its peak of 30,000 RMB [2][6]. Market Response - Despite the launch, the sales performance has been relatively subdued compared to previous hot sales patterns [3][5]. - In Guangzhou, the two projects, Zhongshan Longpo Garden and Guangzhou Yicui Manor, have a combined sales rate exceeding 92%, but the market response has been lukewarm [6]. - Dongguan Haiyi Haoting has faced high inventory issues, with around 160 units unsold since 2014, leading to a strategy of price reduction to stimulate sales [6][7]. Buyer Demographics - Nearly 60% of the sold units in Huizhou Longpo Garden have been purchased by buyers from Hong Kong, indicating a significant shift in buyer demographics [10]. - The demand from Hong Kong buyers has been a crucial support for the project, especially as the mainland property market cools down [9][10]. Financial Performance - Cheung Kong's revenue for the fiscal year 2024 was 45.529 billion HKD, a decrease of 3.63% year-on-year, with net profit dropping by 21.24% [15]. - The company's property sales revenue from mainland China fell by 24.26%, with the contribution from mainland sales dropping from 50.40% to 32.47% [16]. - Despite achieving some sales, the significant price reductions have severely compressed profit margins, leading to a situation where the company has gained sales but lost profitability [16][21]. Strategic Considerations - The current push to sell properties in the Greater Bay Area reflects a strategic shift in response to market conditions, with a focus on clearing inventory [22]. - The company holds substantial land reserves in the Greater Bay Area, which could support development and sales over the next 3 to 5 years [21].