What impact will the frequent large dividends of property stocks in the Hong Kong stock market have on the market? Which companies have relatively strong short-term trends in multiple property stocks?
Recently, property stocks in the Hong Kong stock market have continued to rise, and today it has welcomed an upward trend.
At the close,$KINGFARPROPERTY (01354.HK)$It has risen more than 20%.$XINYUAN PM (01895.HK)$,$ES SERVICES (01995.HK)$Even small-cap property stocks have also seen double-digit gains.$CHINA RES MIXC (01209.HK)$,$SHIMAO SERVICES (00873.HK)$Both soared over 8%,$EVERG SERVICES (06666.HK)$Follow the trend.
HSBC released research reports stating that, due to the drag from the real estate market, the property management industry has been less popular in recent years. However, the latest performance shows that some property enterprises have demonstrated resilience in difficult market conditions and are committed to enhancing shareholder returns.
This week, several property companies listed in Hong Kong have released their interim performance, showing signs of a warming industry fundamentals at the micro level.
On August 27th, $CHINA OVS PPT (02669.HK)$Announcement: In the first half of the year, the revenue was 6.838 billion yuan, a year-on-year increase of 9.0%, which was lower than market expectations. However, the company's net profit in the first half of the year increased by 16.0% to 0.738 billion yuan, and both the gross margin and net margin rebounded, partly confirming the market's previous analysis of cost reduction and efficiency improvement in the industry.
Subsequently, China Resources MixC also released its semi-annual report, achieving operating income of 7.957 billion yuan, a year-on-year increase of 17.1%, and a net profit of 1.908 billion yuan, a year-on-year increase of 36.0%, which continued to drive short-term bullish sentiment.
What is worth noting is that many property stocks, after the release of their mid-year reports, have all announced that they will increase their efforts to give back to shareholders. Several companies have a dividend payout ratio of over 50%, which has also attracted attention from funds sensitive to high dividend attributes.
For example, in addition to disclosing its interim report, China Resources MixC also announced the distribution of interim dividends and special dividends, with a total amount of approximately 1.949 billion yuan, equivalent to distributing the full profit for the first half of the year. In addition, China Overseas Property announced that the distribution ratio of the interim dividend was increased from 25% in 2023 to 35%.
Earlier, the disclosed performance of$ONEWO (02602.HK)$The interim dividend ratio reached 100%, and the company also continued to buy back with the authorized amount of HKD 5.8 billion approved by the board of directors recently.
On the other hand, among the property stocks that recently released their performance,$JINKE SERVICES (09666.HK)$It plans to increase the dividend distribution ratio to no less than 60%.$EXCELLENCE CM (06989.HK)$The dividend amount also accounted for 50% of the interim profit.
Overall, due to the current recovery stage of new home sales in the domestic market, many real estate companies as property management companies have a strong demand for dividend distribution to their affiliated shareholders, and the high dividend payout to shareholders in the property industry may become the norm.
Analysts He Miannan and Wei Yongqiang from Everbright Securities have also pointed out in previous research that due to the positioning of the property industry as the "grassroots pillar of community governance", the fundamentals are solid and cash flow is abundant. In the medium to long term, as the growth center shifts downward, it is expected that high-quality existing assets will continue to generate stable returns.
Editor/Rocky