Hong Kong Retail Research: Comprehensive Analysis

Broker: CGS International

Date: November 6, 2024

Overview of Market Trends

Stocks climbed on Tuesday while Treasuries were mixed and the dollar fell as the US presidential race loomed with significant implications for the economy. The movements in the market lacked strong conviction as the contest remained tight. The tech sector led the gains, with the S&P 500 rising by 1.2% and the “Magnificent Seven” megacaps climbing 1.8%. Palantir Technologies saw a surge due to “unwavering demand” for artificial intelligence, and Nvidia Corp. surpassed Apple Inc. to become the largest company in the world.

Nongfu Spring Co Ltd (9633): Bullish Reversal on the Way

Last price: 33.25

Nongfu Spring Co Ltd is poised for a bullish reversal, showing signs of an early uptrend. This company, which supplies soft drinks, including bottled mineral water, fruit juice, sports drinks, and tea drinks, is seeing significant technical indicators suggesting a positive movement.

• The stock has broken out of a falling wedge/flag formation with a strong bullish marubozu candle, confirming the reversal of the cup and handle formation.

• Closure above HK\$30.80 resistance turned support is crucial as it marks a return to the upside, being the previous major low on March 16, 2022.
• Prices have closed above all Ichimoku indicators.
• MACD histogram is positive, and both MACD and signal lines are elevating above the zero line.
• Stochastic Oscillator is supported above the 50-line.

Entry Price(s): 33.25, 30.00, 26.00

Support 1: 30.80

Support 2: 25.40

Stop Loss: 22.90

Resistance 1: 35.85

Resistance 2: 46.25

Target price 1: 39.52

Target price 2: 50.00

Target price 3: 55.00

Target price 4: 62.82

Cromwell European REIT: Portfolio Stability and Refinancing

The Cromwell European REIT reported a stable portfolio with a slight year-on-year increase in net property income (NPI) for the third quarter and first nine months of 2024. The company’s loans are secured, and it is awaiting an optimal time to reissue bonds maturing in FY25.

• 3Q/9M24 NPI: +7.0%/-0.8% yoy; in line with 25.9%/74.7% of FY24F expectations.
• Loans secured, awaiting optimal time to reissue bonds maturing in FY25.
• Reiterated as “Add” for its strong portfolio and capital management strategies.

Elite UK REIT: Taking the Right Steps Forward

Elite UK REIT continues to make progress with its strategic initiatives, showing a promising outlook for investors.

Netlink NBN Trust: Resilient DPS Growth

Netlink NBN Trust reported resilient dividend per share (DPS) growth of 1.1% year-on-year, demonstrating its stability and reliability as an investment.

CapitaLand Integrated Commercial

CapitaLand Integrated Commercial continues to be a key player in the real estate market, with strategic initiatives and strong market presence.

Conclusion

In summary, the Hong Kong retail market is showing signs of positive momentum, with several companies demonstrating strong growth potential and strategic stability. Investors should consider the detailed technical and fundamental analyses provided to make informed decisions.