pennfierce3liveliner4000| [Broker Focus] CCB International maintains Yuexiu Services (06626)"outperform the market" rating, indicating that the share repurchase plan exceeds expectations

Jinwu Caixun| CCB International Research Report pointed out that Yuexiu Services (06626)pennfierce3liveliner4000The share repurchase plan of the company surprised the market because it and its parent company Yuexiu Property were relatively inactive in share repurchase in the past. It is expected to be a response to the State Council's call to include market value in key performance indicators (KPIs) for state-owned enterprises. Currently, Yuexiu Services is valued at an expected P/E ratio of 9.9% for fiscal year 2024pennfierce3liveliner4000.3 times, expected dividend yield for fiscal year 2024 5pennfierce3liveliner4000.4%, and the market current rate is 1.1 times. The bank believes that compared with mergers and acquisitions or bank depositspennfierce3liveliner4000With his form of capital management, the decision to repurchase shares will prove more value-adding.

From a trading perspective, Yuexiu Services 'average daily trading volume this year is approximately 1.3 million shares, which means that it takes 23 trading days to repurchase all 30.4 million shares without hindrance. The bank expects the actual repurchase window to be as long as six months, and only needs to use about 2% of its RMB 4.7 billion cash balance to provide downward support for the stock price. In May 2024, the market value of Yuexiu Services has reached the HK$5 billion threshold required to enter the Hong Kong Stock Connect. Although it may take months to prove that it is suitable for Hong Kong Stock Connect, the bank expects that once southbound investors are allowed to trade the stock, the stock price will have more room to rise, accompanied by potential revaluation opportunities. Maintain the "Outperform" rating. The target price remains at HK$4.5.