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<Research> HSBC Research Lowers TP for CHINA OVERSEAS (00688.HK) to HKD13.4, Maintains 'Hold' Rating
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HSBC Global Research published a report stating that CHINA OVERSEAS (00688.HK) had last year's results in line with expectations, but the deterioration in gross margin was more severe than anticipated, coupled with a significant decline in unbooked sales, leaving short-term profit prospects unclear. The report noted that last year's revenue fell by 9% year-on-year, with the gross margin narrowing by 2.2 ppts year-on-year to 15.5%, placing the property development gross margin at the lower end of management's previous guidance of 14% to 16%. Unbooked sales fell by 17% year-on-year, and the firm believes that profit visibility is limited. Management plans to launch more projects in the first half of this year, with saleable resources reaching RMB600 billion, of which 37% comes from new projects, and the company's saleable value in Hong Kong reaching RMB53 billion, which may support sales growth this year. HSBC Research has lowered its revenue forecasts for CHINA OVERSEAS for 2026 and 2027 by 12% and 9%, respectively, to reflect the contraction in contract liabilities. Due to continued pressure on the gross margin of property development, the gross margin forecasts for the same period have been lowered by 0.8 and 0.9 ppts, with core profit forecasts for 2026 and 2027 adjusted down by 10% and 8%, respectively. The firm maintains a 'Hold' rating, with the target price lowered from HKD14.7 to HKD13.4. (ec/u) This article was automatically translated by AI, the Chinese version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation. Auto-translated by AI AASTOCKS Financial News |
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