[ET Net News Agency, 31 July 2020] Credit Suisse chopped its target price for Wharf
REIC (01997) to HK$27.5 from HK$41.3 and maintained its "neutral" rating.
The research house said Wharf REIC's 1H underlying profit was trimmed by 26% to
HK$3.8bn, mainly due to the decline in retail rental income and the amortisation of rental
concession.
Looking ahead, management is cautious about the retail sales/rental prospects of its HK
portfolio as the COVID-19 situation is worsening in HK and the cross-border travel
restriction is to stay tight.
Credit Suisse cut its FY2020-22 profit estimates by 14-17% to factor in (1) 10% spot
rent cut for Harbour City and Times Square in 2020; and (2) the impact of rental relief
(HK$1bn offered in 1H). (KL)