Soochow: Maintains "Buy" rating for GUANGDONG INV (00270), water resources business stable

Soochow released a research report stating that GUANGDONG INV (00270) water sector performance is stable, and the liability has improved after the spin-off of GD LAND. The dividend ratio is stable and cash flow certainty is strong. Considering better-than-expected cost reduction and efficiency improvement, the bank has raised the net profit attributable to shareholders for 2025-2027 from 42.74/43.57/44.53 billion Hong Kong dollars to 45.36/46.49/47.41 billion Hong Kong dollars, corresponding to a PE ratio of 10.3/10.0/9.9 times. Assuming a 65% dividend ratio for the year 2025, the corresponding dividend yield for the year 2025 is expected to be 6.3%. The bank maintains a "buy" rating. Key points from Soochow: Event: The company's operating revenue for 2025Q1-Q3 was 14.281 billion Hong Kong dollars, an increase of 1.3% year-on-year, and the comprehensive surplus attributable to the owners of the company was 4.067 billion Hong Kong dollars, an increase of 13.2% year-on-year. Net profit attributable to shareholders increased by 13.2%, while financial expenses decreased by 52.9% year-on-year. The water resource business is stable, with double-digit revenue and profit growth for the East Shenzhen Water Supply Project and a 2.6% increase in income from water supply to Hong Kong. The risks of supply volume falling short of expectations and overdue accounts receivable recovery. *Disclaimer: This is a financial analysis report and should not be considered as investment advice.