JP Morgan: Upgrades CK ASSET (01113) to "overweight" rating and raises target price to 52 Hong Kong dollars.

JPMorgan Chase released a research report on CK ASSET (01113), maintaining a "buy" rating. Although the impact on the Hong Kong residential market has been slight since the outbreak of the war, the bank is inclined towards defensive stock selection due to its upcoming net cash position. The target price has been raised from 48.5 Hong Kong dollars to 52 Hong Kong dollars. While the performance of Hong Kong property stocks has generally exceeded expectations, looking ahead to the second quarter, JPMorgan believes that this sector will also find it difficult to completely avoid the macro uncertainty brought about by recent Middle East conflicts. The main concern is the possibility of interest rate hikes, although the bank's current base case scenario still assumes that rates will remain unchanged until the first quarter of 2027. At the same time, the bank has downgraded HENDERSON LAND (00012), which is sensitive to interest rates, and WHARF REIC (01997), whose earnings per share and dividend are uncertain, to a "neutral" rating. The former's target price has been reduced from 35 Hong Kong dollars to 30 Hong Kong dollars, while the latter's target price has been reduced from 29 Hong Kong dollars to 23 Hong Kong dollars. The bank's top picks in the industry include developers such as SINO LAND (00083), SHK PPT (00016), and Cheung Kong; rental stocks such as SWIRE PROPERTIES (01972) and Hongkong Land. The bank also has a positive view on conglomerates such as CKH HOLDINGS (00001), as it benefits from rising oil prices.