Hong Kong stock market movement: China State Construction International Holdings Ltd (03311) rose nearly 3%, up 1.77% as of press time to HK$8.625, with a turnover of HK$57.09 million.
On the news front, Citigroup issued a research report stating that two favorable policies benefit the company: the reform of China's property pre-sale system and Hong Kong's increase in the penetration rate of Modular Integrated Construction (MiC) for public housing, along with the target of 70,000 public housing units over the next five years.
China State Construction International Holdings Ltd (03311) plans to increase capital expenditure to expand MiC production capacity in Beijing, Shanghai, and Guangzhou to meet potentially higher-than-expected demand from mainland China and Hong Kong.
Citigroup noted that according to an August-end notice, China intends to shift the real estate market from a pre-sale model to a completed-home sales model, which will prompt developers to adopt MiC more widely, shortening construction periods from the traditional two to three years to approximately nine months. This benefits the company given its leading position in MiC in both mainland China and Hong Kong.
Hong Kong's first "Five-Year Plan" shows that land ready for immediate construction in the Northern Metropolis will increase to 900 hectares by 2030-2031, supporting more than 70,000 public housing units. The company has accumulated over HK$100 billion in Northern Metropolis orders.
The five-year plan also requires that at least half of public housing units be built using MiC from 2026/27 to 2030/31.
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