Goldman Sachs: Expected 50% increase in property prices this year, office rents to continue falling by half, Adjusting target prices for Hong Kong integrated enterprises and real estate stocks (table)

Goldman Sachs released a research report stating that it maintains a 5% forecast for the recovery of Hong Kong property prices this year, and has lowered its forecast for office rental prices from an expected 2% increase to a further 5% decline. They also agreed with market views that residential properties will be the first sector to bottom out, but have a relatively positive view on the Hong Kong retail market, expecting monthly sales trends to stabilize and show year-on-year growth in the coming months. The company has adjusted its earnings forecasts for the companies it covers for the fiscal years 2024 to 2026, with adjustments ranging from an 8% decrease to a 23% increase, as well as adjusting target prices by ranging from a 13% decrease to an 11% increase. The company also pre-examined the performance of Hong Kong property stocks for the fiscal year 2024, and believes it is worth noting that HENDERSON LAND (00012), KERRY PPT (00683), and MTR CORPORATION (00066) may potentially reduce dividends or adjust their dividend policies. The company still prefers companies with sustainable dividends (such as Swire, Nine Dragons) that are supported by strong balance sheets or free cash flow; companies that may benefit from potential stabilization in the Hong Kong property market and Hong Kong/Mainland retail sales (such as New World, Link REIT, HANG LUNG PPT); and companies with potential for mergers or restructuring (such as CKH HOLDINGS). Goldman Sachs' investment ratings and target prices for Hong Kong conglomerates and property stocks are as follows: