[ET Net News Agency, 9 February 2021] Daiwa Research lowered its target price for Joy
City Property (00207) to HK$0.5 from HK$0.8 and downgraded its rating to "hold" from
"buy".
The research house believes that Joy City has strong mall management capability, but
Daiwa sees uncertainties in the retail property sector due to the possible reemergence
of COVID-19 and supply of new malls.
Daiwa said many of Joy City's malls saw lower unit rentals in 2020 versus 2019.
Meanwhile, the company's three hotels recorded average occupancy rates of 38-63% and
average revenue per room of CNY792-966/night in 2020. It has five malls that are scheduled
for launch in 2021, but uncertainties ahead.
Daiwa raised its 2021 EPS forecast by 32%, factoring in the CNY503m gain from the
disposal of the Shanghai office buildings. But it cut its 2022 EPS estimate by 15% on
lower rental income projection and gross-margin assumption. (KL)