Daiwa: Raises Target Price of China Resources Land to 39.3 Hong Kong Dollars, Expected Total Rental Income to Exceed Management Guidance this Year.

Morgan Stanley released a report stating that their on-site investigations of four China Resources Mixc City malls in the middle of the month showed strong performance in retail sales and foot traffic in the first half of the year, with steady rental growth, strengthening their confidence in China Resources Land's continuous market share acquisition. The bank predicts that the same-store sales growth of its malls will remain at 5% to 10%, higher than the industry average, supporting a rental growth of 13% to 14% in the second half of the year, while the opening of new malls will provide a boost. They have raised their forecast for the total rental income of China Resources Land this year by 3% to 33 billion yuan, an annual increase of more than 13%, exceeding the management's guidance of 8% to 10% growth; and have also raised their forecasts for next year and the year after by about 3% each, to 36.6 billion and 40.3 billion yuan respectively, implying a compound annual growth rate of over 11%. Along with an increase in operational leverage leading to a margin improvement, the bank has raised its core profit and dividend forecasts for China Resources Land from this year to 2027 by 0.7% to 3.1%, and has raised the stock's target price from 38.8 Hong Kong dollars to 39.3 Hong Kong dollars, maintaining a "buy" rating.