UBS raises HYSAN DEV's target price to HKD 15.7, rating "Neutral"

UBS published a research report stating that driven by the decline in Hong Kong Interbank Offered Rate (HIBOR) and the improvement in the fundamentals of the Hong Kong retail and office building market, Hysan Development (00014.HK) has seen its stock price rise by 33% year-to-date. The bank indicated that although the buffer space remains small, operating cash flow should generally cover dividend payments from 2025 to 2026. Due to the increasing difficulty in obtaining new financing, primarily because commercial banks remain cautious about Hong Kong commercial real estate, and bond yields remain high, any deterioration in fundamentals could trigger a dividend cut.

The bank stated that it has lowered its earnings per share forecast for Hysan for 2026 to 2027 by 7% to 9%, raising its target price from HKD 11 to HKD 15.7, with a rating of "Neutral."