Core Viewpoint - The report from Shenwan Hongyuan sets a target price of HKD 26.4 for Kerry Properties (00683), initiating coverage with a "Buy" rating, highlighting the synergy between high-end residential development and quality IP leasing [1] Group 1: Business Overview - Kerry Properties is expected to achieve a revenue of HKD 19.5 billion in 2024, representing a year-on-year increase of 49%, with property development, IP rental, and hotel operations contributing 66%, 25%, and 9% respectively [2] - The company focuses on high-end residential properties and IP in key cities including Beijing, Shanghai, Shenzhen, Hangzhou, and Hong Kong, with land reserves totaling 49.71 million square feet as of the end of H1 2025 [2] Group 2: IP and Hotel Operations - The total value of the company's IP as of H1 2025 is HKD 86.3 billion, a year-on-year increase of 14%, with mainland China and Hong Kong accounting for 67% and 33% respectively [2] - The company plans to increase its IP and hotel area by 36% to 28.93 million square feet by 2031, with a projected 7-year CAGR of 7% from 2024 to 2031 [2] Group 3: Real Estate Development - In H1 2025, the company achieved sales of HKD 16.2 billion, a year-on-year increase of 130%, with mainland China and Hong Kong contributing 66% and 34% respectively [3] - The Shanghai Jinling Huating project is a key driver for mainland sales, with significant sales figures and a strong market response [3] Group 4: Financials and Dividends - As of H1 2025, the company's total borrowing stood at HKD 59.6 billion, a decrease of 2% year-on-year, with a net debt ratio of 38.4% [4] - The company has maintained a stable dividend payout since 2017, with a dividend per share (DPS) of HKD 1.35 and a high dividend yield of 6.9% [4]

Core Viewpoint - The report from Shenwan Hongyuan initiates coverage on Kerry Properties (00683) with a target price of HKD 26.4 and a "Buy" rating, highlighting the synergy between high-end residential development and quality IP leasing [1] Business Overview - Kerry Properties is expected to achieve a revenue of HKD 19.5 billion in 2024, representing a year-on-year increase of 49%, with property development, IP rental, and hotel operations contributing 66%, 25%, and 9% respectively [2] - The company's land bank totals 49.71 million square feet, with 42% in development properties, 37% in investment properties, 11% in hotels, and 10% in properties held for sale, primarily located in mainland China and Hong Kong [2] IP and Hotel Operations - The company's IP value reached HKD 86.3 billion in the first half of 2025, a year-on-year increase of 14%, with 67% from mainland China and 33% from Hong Kong [3] - Total IP and hotel area is 21.33 million square feet, with major cities accounting for 73% of the total area; rental income from IP and hotels showed slight declines due to market conditions, but occupancy rates remain above market averages [3] - The company plans to increase its IP and hotel area by 760,000 square feet by 2031, achieving a compound annual growth rate (CAGR) of 7% from 2024 to 2031 [3] Real Estate Development - In the first half of 2025, the company achieved sales of HKD 16.2 billion, a year-on-year increase of 130%, with mainland China and Hong Kong contributing 66% and 34% respectively [3] - The Shanghai Jinling Huating project is a key driver for mainland sales, with significant sales figures and expected profitability due to relaxed price limits [3] - In Hong Kong, sales from luxury projects have been crucial, with the company focusing on high-end residential developments [3] Financial Health and Dividends - The company maintains a strong financial position with total borrowings of HKD 59.6 billion, a year-on-year decrease of 2%, and a net debt ratio of 38.4% as of the first half of 2025 [4] - The company has consistently paid dividends since 2017, with a dividend per share (DPS) of HKD 1.35, resulting in a high dividend yield of 6.9% [4]