The analyst rating for SHK PPT (00016.HK) is "Overweight," primarily due to several positive factors highlighted in the report by Morgan Stanley. The anticipated 13% year-over-year growth in underlying EPS to HKD3.89 for 1HFY26, along with the expectation that interim DPS will remain unchanged at HKD0.95, indicates strong financial performance. Additionally, the successful execution of the Sierra Sea Phase 2A & 2B projects and the upcoming launch of the luxury project CULLINAN HARBOUR PHASE II are expected to contribute positively to the company's margins. The report notes that the margin for property development projects could reach high-teens, supported by lower costs from completed inventory and recent price hikes in new property sales. The expected high transaction prices for the new project further suggest a substantial margin, reinforcing the positive outlook and justifying the Overweight rating with a target price of HKD120.
