Citigroup: Raises target price of SWIREPROPERTIES (01972) to 28.8 Hong Kong dollars, maintains "buy" rating.

Citigroup released a research report stating that it maintains a "buy" rating on SWIREPROPERTIES (01972), with the target price raised from HK$23.8 to HK$28.8, representing a 45% discount to its net asset value. Citigroup believes that SWIREPROPERTIES' commitment to growth in per share dividends to shareholders is supported by the following factors: 1) Strong growth in same-store retail sales in mainland China driving positive rental rate adjustments, benefiting from tenant renewals and asset upgrades to capture market share; 2) In terms of new investment properties, forecasted total gross floor area growth of 27% and 40% year-on-year from 2026 to 2027, with rental synergies driving upward trends; 3) Strong balance sheet with a 15% asset-liability ratio, providing sufficient flexibility to support its capital expenditure of 100 billion RMB for strategic investments; 4) Forecasted earnings growth in 2026 and 2027, driven by modest rental increases and significant contributions from new development properties. The bank believes that these positive factors can mitigate the impact of negative rental adjustments faced by Hong Kong office buildings due to new market supply competition in 2026 and 2027. With a planned orderly succession of the chief financial officer, the bank expects a consistent capital allocation strategy to create long-term value.