Hong Kong Stocks Concept Tracking | Shanghai Property Market has its Best Start in 3 Years, Foreign Institutions are Optimistic about Real Estate Recovery (with concept stocks)

On April 23, the Shanghai Bureau of Statistics released the first quarter of 2025 Shanghai national economic operation and the basic situation of real estate development and operation. The data shows that the overall economic development in Shanghai has started steadily, and high-quality development is being solidly promoted. In the first quarter, real estate development investment in Shanghai increased by 5.1% compared to the same period last year; the construction area of commercial buildings increased by 7.3% year-on-year, with residential construction area increasing by 9.5% year-on-year; the sales area of residential commercial buildings reached 3.2978 million square meters, an increase of 2.2% year-on-year. The real estate market remained hot in the second quarter, with second-hand housing transactions in April exceeding 15,000 units, breaking the thousand units mark on weekends, and it is expected to reach 20,000 units for the month. Recently, various regions have introduced policies to stimulate consumption, incorporating stabilizing the real estate market into the policy framework. CITIC SEC believes that the importance of the real estate industry in stimulating consumption policies is reflected in both direct and indirect consumption related to housing, as well as the important impact of housing price wealth effect on residents' income confidence and consumption willingness. They expect national policies to be introduced in April-May, and development companies with strong product competitiveness and enterprises holding high-quality operating assets have investment value. CitiGroup strategists are calling on investors to increase their holdings of Chinese real estate stocks, as policy support and better management practices are expected to improve the industry's profitability. HSBC HOLDINGS analysts also have a more optimistic view of the real estate industry, believing that the ROE (return on equity) of major developers will recover, leading to profit growth. CITIC SEC believes that with increased external uncertainties, policies to boost domestic demand will gradually be strengthened, and real estate will be an important part of the policy framework to stimulate consumption. Its importance is reflected in both direct and indirect consumption related to housing, as well as the important impact of the housing price wealth effect on residents' income confidence and consumption willingness. They predict national policies to be introduced in April-May, and companies with strong product competitiveness and enterprises holding high-quality operating assets have investment value. Real estate-related industry chain companies: CHINA OVERSEAS(00688), C&D INTL GROUP(01908), YUEXIU PROPERTY(00123), GREENTOWN CHINA(03900), SUNAC(01918), LONGFOR GROUP(00960), SINO-OCEAN GP(03377), CHINA VANKE(02202), CHINA RES LAND(01109), XUHUI HOLDINGS(00884), etc; Property management companies: CHINA RES MIXC(01209), POLY PPT SER(06049), CHINA OVS PPT(02669), MIDEA REAL EST(03990), etc. Real estate agencies: BEKE-W(02423), CG SERVICES(06098)