, an analyst from CGS-CIMB, reiterated the Buy rating on Link Real Estate Investment. The associated price target is HK$41.00.
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CGS-CIMB’s rating is based on a combination of factors that influence Link Real Estate Investment’s financial outlook. Despite a decline in the distribution per unit (DPU) due to negative rental reversions in Hong Kong and China, CGS-CIMB anticipates a narrowing of this decline in the coming years. This expectation is supported by potential interest rate cuts and effective cost-saving measures that are projected to offset the revenue shortfall.
Moreover, the firm highlights the stability in overseas revenue growth and the potential benefits from management’s cost-saving initiatives, such as staff reductions and efficiency improvements through AI. These initiatives are expected to yield significant savings, which, along with a favorable borrowing cost environment, could enhance Link’s financial performance. Additionally, the potential inclusion in the stock connect program and a solid dividend yield further bolster the Buy rating, despite the challenges in the domestic market.
In another report released today, DBS also maintained a Buy rating on the stock with a HK$46.30 price target.