Date: 3 October 2024
Broker: MIB Securities (Hong Kong) Ltd

Overview of CR Mixc (1209 HK)

CR Mixc is identified as one of the preferred stocks in the property sector, particularly within the mall operations segment. The company’s prospects are positively influenced by recent government measures aimed at reviving the housing market in Tier-1 cities such as Shanghai, Guangzhou, Shenzhen, and Beijing.

Government Easing Measures in Tier-1 Cities

As of 30 September 2024, several Tier-1 cities in China implemented a series of easing measures intended to support the struggling property market. These measures included:

1. Loosening Home Purchase Restrictions: Full removal in Guangzhou, with partial easing in Shanghai, Shenzhen, and Beijing.
2. Lowering Down Payment Ratios: This applied to both first and second home purchases, though second-home buyers still faced higher down payment requirements compared to the national level.
3. Tax Relief: A reduction in value-added tax (VAT) for secondary homes, exempting VAT (5%) for homes held for over two years in Shanghai and Shenzhen.
4. Removal of Home-Selling Restrictions: Shenzhen completely removed restrictions on selling homes.

Impact on CR Mixc (1209 HK)

CR Mixc stands to benefit from these easing measures as they are expected to improve consumer sentiment and spending power, particularly in Tier-1 cities. The reduction in mortgage rates is expected to increase household savings, which would in turn support mall operators like CR Mixc, as increased disposable income often leads to greater consumer spending.

Favorable Market Environment

Following the announcement of these easing measures, the property sector experienced a significant rally. As of 30 September 2024, the SSE Property Index, which tracks Chinese developers, had risen by 34.3% since its low on 18 September 2024. This rally has been particularly beneficial to both privately-owned enterprises (POEs) and state-owned enterprises (SOEs) like CR Mixc. The recovery in stock prices, combined with supportive government policies, has positioned CR Mixc for continued growth in the near term.

Conclusion

CR Mixc is seen as a strong performer within the property sector, with its focus on mall operations and its exposure to Tier-1 cities making it a prime beneficiary of recent easing measures. With increased household savings and improved market sentiment, the outlook for CR Mixc remains positive for 2024 and beyond.