SHKP maintains fair value at $130 amidst market softness: report

The firm reaffirmed its fair value estimate at $130 and maintained a 3-star rating, suggesting the stock is fairly valued at current levels.

Sun Hung Kai Properties Ltd. (SHKP) remains financially resilient despite persistent softness in Hong Kong’s property market, according to a stock analyst note published by Morningstar.

The firm reaffirmed its fair value estimate at $130 and maintained a 3-star rating, suggesting the stock is fairly valued at current levels.

Whilst the removal of property cooling measures earlier in 2025 led to a short-lived boost in residential sales, the momentum has since stalled, and prices continue to decline amidst cautious buyer sentiment and intense developer competition.

A key strength for SHKP is its substantial investment property portfolio, which generates over 60% of its net profit from recurring rental income.

This stream provides stability even as development earnings come under pressure. The company’s commercial assets continue to perform steadily, supported by low vacancy rates and long lease tenures.

Morningstar also sees SHKP’s dividend as secure. The firm maintains a low net gearing ratio—below 15%—and does not rely heavily on land disposals to fund operations.

However, the report cautioned that unless homebuyer confidence improves or macroeconomic conditions strengthen, SHKP is unlikely to see significant earnings growth in the near term.

Despite limited short-term catalysts, Morningstar considers SHKP a relatively defensive option within the sector, given its rental exposure, disciplined capital structure, and quality assets.