Shenwan Hongyuan Securities·2025-12-05 08:14Group 1: Market Overview - The Hong Kong high dividend index has a dividend yield of 5.63%, significantly higher than the average yield of 2.96% from 10-year Chinese and U.S. government bonds, indicating strong investment value[11] - The Hong Kong dividend sector is approximately 5-6% cheaper than the overall A-share market after considering a 20% dividend tax[12] - From October 2 to December 1, the high dividend index outperformed the market, with the Hang Seng Hong Kong Stock Connect China Central Enterprise Dividend Index rising by 7.62%[3] Group 2: Sector Analysis - The banking sector is expected to enter a stable profit cycle, with a potential reversal of the downward trend in interest margins by 2026[4] - In the transportation sector, the road freight volume growth improved quarter-on-quarter in Q3 2025, with key companies like Sichuan Chengyu H, Zhejiang Hu-Hangzhou-Ningbo, and Ninghu Expressway showing promise[3] - Coal companies like China Shenhua and China Coal Energy are projected to have dividend yields of 4.7% and 4.44%, respectively, with Yancoal Australia potentially improving its yield to 7.65%[4] Group 3: Investment Recommendations - The utility sector is benefiting from cost reductions and expected capacity price increases in 2026, with Huaneng International Power and China Resources Power forecasted to have dividend yields of 6.65% and 5.73%[4] - Real estate companies such as Hang Lung Properties, Swire Properties, and Kerry Properties are projected to yield 7.20%, 5.99%, and 6.53%, respectively, due to the recovery of the Hong Kong economy[4] - Environmental companies like China Everbright Water are expected to have a dividend yield of 8.14%, highlighting opportunities in the sector[4]