00960 Overview

Profit Warning Issued: Longfor Group has issued a profit warning, with UBS predicting a core net loss of RMB1.5-2 billion for 2025, significantly higher than their previous estimate of RMB450 million.

Impact on Valuation: UBS maintains a Neutral rating on Longfor Group with a target price of $10.2, citing expected annual losses of RMB7-7.5 billion in the property development sector for 2025-2026, which could negatively affect the company's net asset value.

Profit Warning: LONGFOR GROUP anticipates a core loss of RMB1.5-2 billion in 2025, a significant decline from a core profit of RMB7 billion in 2024, primarily due to reduced sales and profit margin pressures in its development business.

Broker Forecasts: Morgan Stanley's report indicates that the loss exceeds their forecast of RMB1.4 billion, highlighting potential downside risks for earnings per share (EPS) in 2026-2027.

Market Rating: Morgan Stanley maintains an Equalweight rating for LONGFOR GROUP with a target price of $8.2, predicting continued losses in 2026 driven by the development business.

Future Outlook: Despite expected losses, recurring profits may grow by about 5%, with the mall business projected to see a growth of 7-9%.

Stock Performance: LONGFOR GROUP (00960.HK) opened 3.02% lower, hitting a low of HKD8.66, and last traded at HKD8.77, down 5.39% with a trading volume of approximately 9.95 million shares.

Profit Warning: The company has issued a profit warning, expecting a core loss of RMB1.5-2 billion for the previous year, a significant decline from a core profit of RMB6.97 billion in the prior year.

Chinese Developers Performance: Several Chinese developers, including CHINA RES LAND and LONGFOR GROUP, received an "Overweight" rating, with varying short selling ratios and stock price increases.

SEAZEN's Financial Outlook: M Stanley has raised SEAZEN's target price to HKD3.17, predicting multiple financings to help reduce total borrowings.

Underperforming Developers: Companies like CHINA VANKE and COUNTRY GARDEN are rated "Underweight," indicating a less favorable outlook, despite some minor stock price increases.

Chinese Managers Overview: Among Chinese property management firms, CHINA RES MIXC and POLY PPT SER are rated "Overweight," while A-LIVING and SUNAC SERVICES are rated "Underweight," reflecting mixed market sentiments.

NPC Meeting Outcomes: The Fourth Session of the 14th National People’s Congress has opened, releasing the latest government work report and the outline of the 15th Five-Year Plan, with a focus on "risk mitigation" and "stability" in the property market.

Market Sentiment: Investor expectations remain low, and while there are no strong signals to boost housing prices, speculative sentiment may emerge as investors prepare for the upcoming Politburo meeting at the end of April.

Short-Term Outlook: JPMorgan predicts that Chinese property developers may underperform the broader market in the short term but could regain strength by early April, depending on market conditions.

Top Picks and Ratings: JPMorgan's top picks among Chinese property developers include CHINA RES LAND, CHINA RES MIXC, and CHINA JINMAO, while state-owned CHINA OVERSEAS and private LONGFOR GROUP are seen as having greater upside potential.

Market Performance: The Hang Seng Index (HSI) fell by 291 points (1.1%) to close at 25,768, with a total market turnover of $370.55 billion.

Active Heavyweights: Major stocks like Xiaomi, Meituan, and Alibaba experienced declines, with Xiaomi dropping 4.7% and Meituan down 2.3%.

Notable Movers: Xinyi Solar and Zijin Mining saw significant losses, with Xinyi Solar down 6.3% and Zijin Mining down 6.1%, while ENN Energy and PetroChina gained 5.1% and 5%, respectively.

Short Selling Trends: High short selling ratios were observed in several stocks, including Ping An at 27% and BYD Electronic at 28.6%, indicating increased bearish sentiment among investors.