HSBC Research: The budget proposal has a positive stance on the property market, favoring New World Development, Henderson Land, and SINO LAND

HSBC Research published a report, expecting that the policy stance of the local property market will continue to be favorable for the real estate market; real estate investment trusts may welcome new opportunities. Among local property stocks, HSBC Research prefers Sun Hung Kai Properties (00016.HK), Henderson Land Development (00012.HK), and Sino Land (00083.HK), all of which are given a "Buy" rating; target prices remain unchanged at HKD 147.5, HKD 37, and HKD 13.9 respectively.

Following the authorities' announcement to raise the stamp duty on residential properties valued over HKD 100 million from 4.25% to 6.5%, some developers' stock prices fell by about 2% yesterday (25th). The bank believes that considering the strong upward trend of the sector since the beginning of the year, this stock price correction is healthy. The impact of this measure should be limited, as it only accounts for 0.3% of the total market transaction volume. The intention behind this move is likely to increase fiscal revenue rather than suppress the overall residential market. More importantly, the bank believes that based on the overall direction of land and housing policy in the 2026/27 Budget, the authorities' policy stance on the residential market remains supportive.

Among developers, Sun Hung Kai Properties, with its saleable resources, should be the main beneficiary of the residential market recovery; while Henderson Land Development has seen improved profit prospects due to better property sales and lower borrowing costs. The bank sees Sino Land's profit outlook growing due to its active land reserve replenishment. The bank maintains its target prices, profit forecasts, and ratings unchanged