CLSA's analyst rating for MTR Corporation is based on the expectation that the company will not experience a quick recovery in recurring profits due to rising costs in Hong Kong's passenger transport sector, which will counterbalance the increase in ticket revenue from more visitors. Additionally, the upcoming opening of Kwu Tung Station in 2027 will lead to higher depreciation expenses, further pressuring operating profits. Although retail sales are improving, rental renewals have declined, indicating a limited recovery in average rents. The target price was raised to HKD32, reflecting a reasonable valuation, and a 'Hold' rating was maintained.
