00142 Overview

Catalysts for Hong Kong Conglomerates: 2026 is expected to be a significant year for Hong Kong conglomerates like CTF SERVICES, Jardines, and FIRST PACIFIC, with multiple catalysts anticipated according to CLSA's research.

Dividend Expectations: Investors can expect to be compensated through dividends, with a projected 3% year-over-year increase in sector dividends for 2026, supported by a 5% growth in recurring earnings and a weak USD.

Top Stock Picks: CLSA's top stock picks include CTF SERVICES and CKH HOLDINGS, both rated as Outperform with target prices of $8.8 and $61, respectively.

Additional Recommendations: CLSA also favors FIRST PACIFIC and SWIRE PACIFIC A, rating them as Outperform with target prices of $8.2 and $74.

Forecast for Hong Kong Conglomerates: CLSA predicts a 5% growth in recurring profits for Hong Kong conglomerates in 2026, with dividends expected to increase by 3% year-over-year.

Market Conditions: The weak USD is anticipated to support conglomerates, which are currently trading at a 32% discount to their net asset value per share, with a projected dividend yield of 4.6%.

Top Stock Picks: CLSA's top stock picks include CKH HOLDINGS and CTF SERVICES, with target prices raised to $61 and $9.6, respectively, both rated as Outperform.

Additional Recommendations: FIRST PACIFIC and SWIRE PACIFIC A are also favored, with target prices set at $8.2 and $74, respectively, and all recommended stocks are considered to offer attractive risk-reward profiles.

Market Performance: The Hang Seng Index (HSI) fell by 1.1% to close at 24,507, with significant drops in other indices and a total market turnover of $254.67 billion.

Stock Movements: Notable stock movements included Tencent and HKEX both declining over 2%, while ZTO Express saw a substantial increase of 7.4%.

Market Performance: The Hang Seng Index (HSI) fell by 45 points to 24,727, while the Hang Seng Tech Index (HSTI) and the Hang Seng China Enterprises Index (HSCEI) also experienced slight declines.

Active Stocks: Notable movements included ZTO Express rising by 8.7%, while Sinopec Corp dropped by 4.8%. Major companies like Alibaba and Meituan saw gains, whereas HKEX, Ping An, and Tencent faced losses.