Listed Real Estate Asia, KT Capital Group

Jacob Cheng

Listed Real Estate Asia

KT Capital Group

Principal investments and advisory firm that focuses on connecting the CIS countries with East Asia.

Principal investments and advisory firm

Thematic (Sector/Industry)

<ul>
<li>News report today that RMB may appreciate 10% due to potential USD weakness and capital inflow of USD1trn back into China, causing upward pressure of the currency</li>
<li>The capital inflow comes from potential unwinding of carry trade, as Chinese companies borrow CNY at low interest rate and place capital in USD deposit, at higher interest rate</li>
<li>We think this scenario is unlikely unless China economy is showing strong recovery.  But, if this happens, it will hurt export but positive for HK-listed Chinese property stocks</li>
</ul>


News report today that RMB may appreciate 10% due to potential USD weakness and capital inflow of USD1trn back into China, causing upward pressure of the currency
The capital inflow comes from potential unwinding of carry trade, as Chinese companies borrow CNY at low interest rate and place capital in USD deposit, at higher interest rate
We think this scenario is unlikely unless China economy is showing strong recovery.  But, if this happens, it will hurt export but positive for HK-listed Chinese property stocks


What Is the Implication if RMB Appreciates 10%?

<ul>
<li>Jackson Hole is annual event among central bankers and economists, where Fed Chair Powell will also be speaking on Friday</li>
<li>In the scenario of a new Fed rate cut cycle, we expect Hong Kong RE, China RE and Singapore RE to benefit, while investors can reduce exposure in Japan RE</li>
<li>We also recommend some trade ideas based on our analysis and suggest specific stocks</li>
</ul>


Jackson Hole is annual event among central bankers and economists, where Fed Chair Powell will also be speaking on Friday
In the scenario of a new Fed rate cut cycle, we expect Hong Kong RE, China RE and Singapore RE to benefit, while investors can reduce exposure in Japan RE
We also recommend some trade ideas based on our analysis and suggest specific stocks


A Scenario Analysis: If Fed Initiates a Rate Cut Cycle, How Should Investors Position Themselves?

<ul>
<li>In this insight, we look at the latest policy support in China property, as well as the latest rate cut from the Central Bank</li>
<li>In the physical market, there are some signs of bottoming out, particularly in key cites such as Shanghai and Shenzhen.  Secondary market is recovering</li>
<li>If investors would like exposure in the sector, we recommend CRL (1109 HK) and COLI (688 HK), both are SOE names with almost zero bankruptcy risks</li>
</ul>


In this insight, we look at the latest policy support in China property, as well as the latest rate cut from the Central Bank
In the physical market, there are some signs of bottoming out, particularly in key cites such as Shanghai and Shenzhen.  Secondary market is recovering
If investors would like exposure in the sector, we recommend CRL (1109 HK) and COLI (688 HK), both are SOE names with almost zero bankruptcy risks


Short Note: China Property Recovery Upcoming with Policy Support and Rate Cut

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>The Politburo meeting re-emphasized the need for inventory reduction and ensuring project completions.</li><li>The latter saw breakthroughs with a stalled residential project in Nanjing returning down payments to homebuyers.</li><li>This success was enabled by stringent oversight of presale regulatory funds and enhanced legal protection for homebuyers.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The Politburo meeting re-emphasized the need for inventory reduction and ensuring project completions.The latter saw breakthroughs with a stalled residential project in Nanjing returning down payments to homebuyers.This success was enabled by stringent oversight of presale regulatory funds and enhanced legal protection for homebuyers.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Property - Weekly Highlight: Sales Decline May Narrow in Aug

<ul><li>The demand-side policy easing continued in multiple cities regarding CPF (central provident fund) housing loans and purchase limits.</li><li>One more city – Hebei’s Cangzhou announced plans to acquire unsold housing inventory.</li><li>The land market showed signs of confidence restoring in a few cities and we suggest watching the good number of land auctions in July. </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The demand-side policy easing continued in multiple cities regarding CPF (central provident fund) housing loans and purchase limits.One more city – Hebei’s Cangzhou announced plans to acquire unsold housing inventory.The land market showed signs of confidence restoring in a few cities and we suggest watching the good number of land auctions in July. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Property - Weekly highlight: expect strong sales momentum to last longer

Hong Kong

China Resources Land is a leading property developer, investor, and operator focused on urban construction and operation in Mainland China. The company develops and manages residential properties, shopping malls, offices, and hotels, and also engages in asset-light management and eco-system elementary businesses. It was founded in 1994 and is headquartered in Hong Kong.

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China Resources Land (1109 HK)

What Is the Implication if RMB Appreciates 10%?

News report that CNY may appreciate 10% due to weaker USD and unwinding of carry trade causing USD1trn capital inflow to China. It's unlikely, but...

Jacob Cheng

A Scenario Analysis: If Fed Initiates a Rate Cut Cycle, How Should Investors Position Themselves?

We conducted a scenario analysis on Asia real estate if Fed is to initiate a new rate cut cycle. Within Asia, we expect Hong Kong, China and...

Jacob Cheng

Short Note: China Property Recovery Upcoming with Policy Support and Rate Cut

In this update, we look at the latest government policy and rate cut, which are tailwinds to the sector. Physical market is recovering. We think...

Jacob Cheng

Property - Weekly Highlight: Sales Decline May Narrow in Aug

The Politburo meeting re-emphasized the need for inventory reduction and ensuring project completions. The latter saw breakthroughs with a stalled...

CMB International

Property - Weekly highlight: expect strong sales momentum to last longer

The demand-side policy easing continued in multiple cities regarding CPF (central provident fund) housing loans and purchase limits.

CMB International

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)