Core Viewpoint - The recovery of the retail market has enabled Swire Properties (HK01972) to achieve stable operating performance in 2025, with total revenue reaching HKD 16.041 billion, an increase of 11% year-on-year, and a net profit attributable to shareholders of HKD 8.62 billion, up 27% year-on-year [2]. Group 1: Financial Performance - The growth in performance was primarily driven by the sale of non-core assets, including the Brickell City Centre shopping center in Miami and various properties in Hong Kong [2]. - In 2025, Swire Properties recorded a net loss attributable to shareholders of HKD 1.533 billion, a significant increase from the previous year, mainly due to changes in the fair value of investment properties, which resulted in a loss of HKD 7.716 billion [2]. - Rental income for the reporting period totaled HKD 13.014 billion, a decrease of approximately 3% year-on-year, with the mainland China market contributing HKD 5.392 billion, a growth of over 2% [2]. Group 2: Retail Market Insights - The CEO of Swire Properties noted that the Chinese government's relaxation of various policies in 2025 successfully boosted consumer confidence, leading to a 7% increase in retail sales across the company's retail properties, outperforming the market and exceeding 2019 levels by 65% [3]. - The most notable retail project in 2025 was the Xinyi Taikoo Hui in Shanghai, which saw a 50% increase in retail sales following the opening of the LV flagship store, while rental income increased by 1% [3]. - Other projects such as Sanlitun Taikoo Li in Beijing and Chengdu Taikoo Li also reported increases in retail sales and rental income, with growth rates of 11% and 3%, and 7% and 5%, respectively [3]. Group 3: Future Outlook and Investment Plans - Swire Properties anticipates that the growth momentum in the mainland retail market will continue into 2026, with double-digit growth in retail sales observed in the first two months of the year [5]. - The company plans to invest significantly in the mainland market, with approximately 67% of its HKD 100 billion investment plan already committed to ongoing projects, aiming to double the total floor area in mainland China [6]. - Key projects include comprehensive developments in Xi'an, Sanya, Shanghai, and Guangzhou, focusing on retail-led initiatives [6].

Core Insights - The UK retail sector shows signs of improvement in January, with the CBI's monthly retail sales balance rising from -44 in December to -17, the highest level since April 2025 [1] - Retailers' sales expectations for the next month improved from -57 to -30, indicating a slight recovery in short-term confidence among retailers [1] - However, CBI's chief economist Martin Sartorius warns that this improvement may not be sustainable, predicting a potential acceleration in sales decline next month due to ongoing low consumer confidence and cautious spending [1] Industry Trends - Official data indicates that UK retail sales have been persistently weak in recent months, with expectations that the upcoming December retail data will continue this trend [1] - Despite a slight boost in sentiment following the Chancellor's budget announcement, S&P Global data reveals that consumer confidence in January has dropped to a nine-month low, casting a shadow over the retail market's recovery [1]

Core Viewpoint - Chuanghui Jewelry (08537) expects a significant increase in net profit for the six months ending September 30, 2025, projecting approximately HKD 3.6 million, compared to HKD 300,000 in 2024, driven by the recovery of the Hong Kong retail market and soaring gold prices [1] Financial Performance - The projected net profit for the upcoming period is approximately HKD 3.6 million [1] - This represents a substantial increase from the previous year's net profit of approximately HKD 300,000 [1] Market Conditions - The growth in net profit is primarily attributed to the recovery of the retail market in Hong Kong [1] - Additionally, the rise in gold prices has contributed to the positive financial outlook [1]

Core Viewpoint - Link REIT (00823) has experienced a decline of over 5%, with a current price of HKD 36.86 and a trading volume of HKD 168 million [1] Financial Performance - The total distributable amount for Link REIT for the period ending September 30 decreased by 5.6% year-on-year to HKD 3.283 billion [1] - The distribution per unit fell by 5.9% year-on-year to HKD 1.2688 [1] - Revenue decreased by 1.8% year-on-year to HKD 7.023 billion, while net property income dropped by 3.4% to HKD 5.178 billion [1] Market Conditions - The decline in performance is attributed to negative rental adjustment rates in Hong Kong and mainland China, reflecting pressure on the macro environment and the retail sector [1] - The chairman of Link REIT, Mr. O'Donoghue, noted that while the retail market in Hong Kong is under pressure, there are signs of recovery in leasing demand [1] - He mentioned that due to the typical three-year lease cycle, there is a natural lag effect, and it will take time for rents to adjust to normal growth, with expectations of continued pressure in the second half of the year [1]

Core Viewpoint - The outlook for rental income and return growth is improving, which is expected to drive the rental yield growth for Kowloon Development [1] Group 1 - The majority of the company's debt is at floating rates, suggesting that a potential decline in HIBOR could reduce interest costs [1] - A sustainable recovery in the retail market may lead to higher stock valuations for Kowloon Development [1] - A more accommodative interest rate environment is anticipated to promote revenue growth and increase the company's stock price [1] Group 2 - The company's rating has been upgraded from "Hold" to "Buy" [1] - The target price has been raised from HKD 27.7 to HKD 29 [1]

Group 1 - Morgan Stanley has raised the earnings per share (EPS) forecasts for Hysan Development (00014) for 2025 to 2027 by 1%, 4%, and 7% respectively, reflecting better-than-expected performance in the first half of 2025 and lower interest costs [1] - The dividend per share forecast for 2025 to 2027 is maintained at HKD 1, compared to HKD 1.08 for 2024, as cash earnings are expected to be insufficient to fully cover the dividends [1] - The target price has been increased from HKD 12.5 to HKD 14.3 [1] Group 2 - The overall retail market in Hong Kong is viewed with caution due to changes in consumer behavior, expected increase in outbound tourism in the second half of the year, and rising unemployment rates [1] - A "reduce" rating is maintained as the market is still waiting for a substantial and sustainable recovery in Hong Kong's retail sector [1]

Core Viewpoint - Morgan Stanley has raised the earnings per share (EPS) forecasts for Hysan Development (00014) for the years 2025 to 2027 by 1%, 4%, and 7% respectively, reflecting better-than-expected performance in the first half of 2025 and reduced interest costs [1] Company Summary - The EPS forecast for 2025 is adjusted upwards by 1%, for 2026 by 4%, and for 2027 by 7% [1] - The dividend per share forecast for 2025 to 2027 is maintained at HKD 1, compared to HKD 1.08 in 2024, due to expectations that cash earnings will not fully cover dividends [1] - The target price for Hysan Development has been increased from HKD 12.5 to HKD 14.3 [1] Industry Summary - Morgan Stanley maintains a cautious outlook on the overall retail market in Hong Kong due to changes in consumer behavior, expected increase in outbound tourism in the second half of the year, and rising unemployment rates [1] - The firm retains a "reduce" rating as it awaits a substantial and sustainable recovery in the Hong Kong retail market [1]