Daily Investment Strategy
Recommended Stock：CKI（1038）
The Group recorded net profit of HK$4.31bn in 1H24, a 2% yoy increase. The profit contribution from the UK business was HK$1.86bn, up 17% yoy. The Group has diversified investments in Energy Infrastructure, Transportation Infrastructure, Water Infrastructure, Waste Management, Waste-to-energy, Household Infrastructure and Infrastructure Related Businesses. Its investments and operations span Hong Kong, Mainland China, the United Kingdom, Continental Europe, Australia, New Zealand, Canada and the United States. Most of the profit of the Company comes from overseas, and therefore can benefit from the USD softness amid rate cut cycle. The Group maintains a strong financial position, with cash holdings of HK$9.2 billion and a net debt to total capital ratio of 9.8% as of June 30, 2024. Cheung Kong Infrastructure and other strategic partners within the Cheung Kong Group, such as CK Property and Power Assets, all possess robust financial strength, putting them in favorable positions to capture global investment opportunities emerging in both existing and new industries. Target price: $62.
China's November Manufacturing PMI Exceeds Expectations
The National Bureau of Statistics of China announced that November's Purchasing Managers' Index (PMI) for the manufacturing sector was 50.3, up 0.2 points from the previous month, indicating expansion and exceeding expectations. Medium-sized enterprises recorded at 50, while small enterprises, though improving, remained in contraction at 49.1.New orders increased, but new export orders remained in contraction, showing stronger domestic demand. Corporate profits are expected to remain weak as the decline in ex-factory prices outpaces the decline in raw material purchase prices, squeezing profit margins. Meanwhile, the non-manufacturing PMI fell to 50, impacted by the construction industry.
On Friday, the southbound funds saw a net inflow of 3.28 billion HKD, with Meituan (3690) receiving the highest inflow of HKD 830 million, followed by Alibaba (9988). On the other hand, the Tracker Fund of Hong Kong (2800) recorded the highest net outflow of 1.52 billion HKD, followed by Xiaomi Corporation (1810).
Wen Kit Kenny is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to:https://apps.sfc.hk/publicregWeb/indi/AJF244/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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