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>While most HK equities are still trading at attractive valuation, it does not mean they can re-rate and many of them can remain value traps</li>
<li>However with the banking crisis, asset owners are moving their capital to Asia.  Hong Kong gov is doing everything to attract family office business</li>
<li>This, along with improving macro outlook, can drive re-rating.  BUY SHKP 16 HK and NWD 17 HK</li>
</ul>


While most HK equities are still trading at attractive valuation, it does not mean they can re-rate and many of them can remain value traps
However with the banking crisis, asset owners are moving their capital to Asia.  Hong Kong gov is doing everything to attract family office business
This, along with improving macro outlook, can drive re-rating.  BUY SHKP 16 HK and NWD 17 HK


HK Equity: 1) Strong Capital Inflow, 2) Pro-Growth Policy, 3) Better Macro Outlook to Drive Rerating

Asia biased macro & technical analysis, Untying The Gordian Knot

Untying The Gordian Knot

Asia biased macro & technical analysis

A differentiated process with a primary focus on Asia. Technical Analysis as core and Macro drivers that could bring the view to fruition & changes that could make the idea fall apart. The objective is to be the best in class, hence corner shop.

Technical Analysis

Henderson Land Development / Technical Analysis

<ul><li>Here comes HIBOR. Its rise is likely to accelerate and brake illusions of stability brought by the Fixed Exchange Rate.</li><li>While countries have been able to adjust to the economic environment through changes in monetary policy and depreciating currency, Hong Kong fixed exchange rate means the cost of adjustment has to be absorbed elsewhere.</li><li>Asset prices and HIBOR are the safety valve to adjust the imbalances due to fixed exchange rates with no capital control.</li></ul>

Here comes HIBOR. Its rise is likely to accelerate and brake illusions of stability brought by the Fixed Exchange Rate.While countries have been able to adjust to the economic environment through changes in monetary policy and depreciating currency, Hong Kong fixed exchange rate means the cost of adjustment has to be absorbed elsewhere.Asset prices and HIBOR are the safety valve to adjust the imbalances due to fixed exchange rates with no capital control.

<ul>
<li>This week some of the strongest names in HSI are covered.</li>
<li>In real estate, banking, and global infrastructure sectors. They have been consolidating for months and should resolve soon to establish new trends or act as a continuation pattens.</li>
<li>These are likely to prove crucial to Hong Kong and Greater China.</li>
</ul>


This week some of the strongest names in HSI are covered.
In real estate, banking, and global infrastructure sectors. They have been consolidating for months and should resolve soon to establish new trends or act as a continuation pattens.
These are likely to prove crucial to Hong Kong and Greater China.


HSBC, Sun Hung Kai Properties, and CK Hutchison Holdings

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

<ul>
<li>There are signs that a base has been building in Real Estate allocations, and that sentiment is starting to stabilise.</li>
<li>Average weights in the Real Estate sector ticked higher by 0.25% and 5.43% of managers moved to overweight, closing the net underweight by 0.22%.</li>
<li>Central Pattana Pub (CPN TB), China Resources Mixc Lifestyle Services (1209 HK) and Capitaland (CAPL SP) were beneficiaries of recent inflows</li>
</ul>


There are signs that a base has been building in Real Estate allocations, and that sentiment is starting to stabilise.
Average weights in the Real Estate sector ticked higher by 0.25% and 5.43% of managers moved to overweight, closing the net underweight by 0.22%.
Central Pattana Pub (CPN TB), China Resources Mixc Lifestyle Services (1209 HK) and Capitaland (CAPL SP) were beneficiaries of recent inflows


HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>With US interest rate trending up, many of the Hong Kong blue chips are exposed to higher interest expenses from their outstanding debt. We look into who are less vulnerable.</li>
<li>
<a href="https://www.smartkarma.com/entities/galaxy-entertainment-group-limited" target="_blank" data-smartkarma-citation="entities:806:1" rel="noopener">Galaxy Entertainment Group (27 HK)</a>, <a href="https://www.smartkarma.com/entities/budweiser-brewing-co-apac-ltd" target="_blank" data-smartkarma-citation="entities:28077:1" rel="noopener">Budweiser Brewing Company APAC (1876 HK)</a>, <a href="https://www.smartkarma.com/entities/xinyi-solar-holdings-ltd" target="_blank" data-smartkarma-citation="entities:318:1" rel="noopener">Xinyi Solar (968 HK)</a>, <a href="https://www.smartkarma.com/entities/power-assets-holdings-ltd" target="_blank" data-smartkarma-citation="entities:788:1" rel="noopener">Power Assets (6 HK)</a> and <a href="https://www.smartkarma.com/entities/mtr-corp" target="_blank" data-smartkarma-citation="entities:13289:1" rel="noopener">MTR Corp (66 HK)</a> are found to be more immunized.</li>
<li>Most have large cash balance, low leverage and more fixed rate debt. GEG, Bud APAC and Xinyi Solar may even benefit from higher interest income given net cash position.  </li>
</ul>


With US interest rate trending up, many of the Hong Kong blue chips are exposed to higher interest expenses from their outstanding debt. We look into who are less vulnerable.

Galaxy Entertainment Group (27 HK), Budweiser Brewing Company APAC (1876 HK), Xinyi Solar (968 HK), Power Assets (6 HK) and MTR Corp (66 HK) are found to be more immunized.
Most have large cash balance, low leverage and more fixed rate debt. GEG, Bud APAC and Xinyi Solar may even benefit from higher interest income given net cash position.  


Rising US Interest Rate: A Look at Which HK Blue Chips Are Less Vulnerable

Hong Kong

Sun Hung Kai Properties is a leading diversified real estate developer in Hong Kong, specializing in the development of residential, office, and retail properties for sale and investment. The company also operates in property management, hotels, telecommunications, transport, and infrastructure. Headquartered in Wan Chai, Hong Kong, the group was founded in 1963.

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Sun Hung Kai Properties (16 HK)

HK Equity: 1) Strong Capital Inflow, 2) Pro-Growth Policy, 3) Better Macro Outlook to Drive Rerating

Recent banking crisis and related capital flows creates opportunities for Hong Kong. Capital inflow, pro-growth policy and improving macro...

Jacob Cheng

SKHP, MTR and Henderson Land

Here comes HIBOR. Its rise is likely to accelerate and brake illusions of stability brought by the Fixed Exchange Rate. Asset prices and HIBOR are...

Untying The Gordian Knot

HSBC, Sun Hung Kai Properties, and CK Hutchison Holdings

In real estate, banking, and global infrastructure sectors. They have been consolidating for months and should resolve soon to establish new trends...

Untying The Gordian Knot

Asia Real Estate: Early Stage Recovery

There are signs that a base has been building in Real Estate allocations, and that sentiment is starting to stabilise among active Asia Ex-Japan...

Steven Holden

Rising US Interest Rate: A Look at Which HK Blue Chips Are Less Vulnerable

We look at what companies in the Hang Seng Index are more immunized to the rising US interest rate environment; and found the top five are with...

Osbert Tang, CFA

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