The Zhitong Finance App learned that CICC released a research report stating that the 2026 profit forecast for Taikoo Properties (01972) remains unchanged, and is expected to increase 28% year over year. Based on more active residential property settlement and property investment rent forecasts, the regular basic profit forecast due in 2027 was raised by 9% to 7.82 billion yuan, down 2% year on year. Maintain the “Outperform the Industry” rating and the target price of HK$28.5 unchanged.
Swire Properties' performance in the first half of the year was slightly higher than expected. Revenue of 9.41 billion yuan, up 8% year on year, and regular basic profit of 4.66 billion yuan, up 36% year on year. This is 7% higher than the bank's previous forecast, mainly due to property transaction settlement profit slightly exceeding expectations. The interim dividend per share was HK37 cents, up 6% year on year. The increase was basically in line with expectations.
According to the bank, Swire Properties' rental income for office buildings in Hong Kong was roughly the same as year on year. The contract rent increase was still negative double digits, but current market rents have shown signs of a steady or even slight increase. Operating profit from property investment and operation increased 13% year over year, but regular basic profit attributable to property investment fell 8% to 3.45 billion yuan, mainly due to changes in interest capitalization rates and deferred taxes.
According to the report, the company entered the development and settlement cycle in 2026-2027. The property trading business contributed 1.2 billion yuan in basic profit in the first half of the year, and is expected to contribute no less than 2 billion yuan for the whole year. Thanks to the continued return of capital, the company maintained a low net debt ratio of 15%. The company's potential properties for sale in Hong Kong and overseas are also expected to support forward capital inflows.