更优惊喜向量：内地房地产胜香港房企——估值重置后偏好内地开发商

REMD Better surprise vector:mainland China over HKdevelopers +Decoupling the trade:We explain why we prefermainlandChinadevelopers overHK players afteravaluationreset Head of Asia Real Estate and HK Equity ResearchThe Hongkong and Shanghai Banking Corporation Limited michellekwok@hsbc.com.hk+85229966918Oliver Yu* Our corethesis is that mainland China property offers morescope for upside surprises relative to Hong Kong Analyst, Asia Real EstateThe Hongkong and Shanghai Banking Corporation Limitedoliver.y.o.x.yu@hsbc.com.hk+85222882050StephenWang*,CFA PreferCRLandC&D,bothratedBuy;landbankreplenishmentanear-termcatalyst Analyst,AsiaRealEstatestephen.wang@hsbc.com.hk+85222841675Brian Yu* We now prefer mainland China developers over Hong Kong property after thevaluation reset. Hong Kong's early rebound has pushed expectations too highdespite a seemingly steadierbackdrop(HongKong Real Estate-2Houtlook,Raymond Liu,7July2026)while mainland China offers a moreasymmetric set-upwith greater scope for upside surprises that investors demand. Associate,AsiaReal EstateThe Hongkong and Shanghai Banking Corporation Limitedian.d.yu@hsbc.com.hk+85228227281 More upside: Mainland China developers remain priced for doubt, but we argue thesectorofferspotential upsideinprimarycontractedsales,margin(drivenbylowerimpairment and higher contracted margin)and earnings recovery.We calculate that ifgross margins are 0.5ppt higher than expected, there will be 13-27% earnings upsideto our current 2026-28 estimates for key developers (Figure 1). In our view, thesector is set to ride on a broad-based earnings recovery in 2027 (Figure 2), a positivethat has yet been fully priced in by the market. *Employedbyanon-US affliateofHSBC Securities (USA) Inc, andisnot registered/qualifed pursuant to FINRA regulations More policy visibility: Mainland China has been largely insulated from global ratevolatility relative to Hong Kong, thanks to a lower domestic rate environment.Separately, the cross-border checks that have impacted Hong Kong sentiment mademainland China property a cleaner investment option with clearer policy visibility. Wealth support: We believe the broad tech rally has created a meaningful wealtheffect for corporate stakeholders with equity incentives, as well as retail investors.Shenzhen's luxuryhousingis servingnotonlyasa lifestyle upgrade,butalso asaway to diversify volatile equity gains into scarce physical assets. Valuation on aparwithrecent troughlevels: Mainland China property's correctioncan be explained by the market front running weaker sales during the slow summerseason. With valuation (P/B ratio) back to recent trough levels, risk/reward is nowmore appealingagainst a backdropof stablephysical market recovery. Keypicks:Wekeep CRLand and C&D as ourpreferred Buy-rated names.CRLshould benefit early from top-tier stabilisation and its C-REIT spin-off remains ontrack.C&D continuestostandoutwithashareholder-friendlyprofile(ahigh singledigit dividend yield) and strong land replenishment momentum for which the stock isreacting positively and supports its medium-term growth outlook (Replenishinglandbank at full throttle, 2 July 2026). Nocountryforbears The 24th edition of the EM Sentiment Survey Click to view Issuer of report: The Hongkong and ShanghaiBanking Corporation Limited Disclosures&Disclaimer This report must be read with the disclosures and the analyst certifications inthe Disclosure appendix, and with the Disclaimer, which forms part of it. View HSBC Global Investment Research at:https://www.research.hsbc.com homeprices,developers'margins,andearnings.Therecentvaluationresetreflectsrenewedconcernsaroundnear-termsalessoftnessandhomepricepressure;however,westillexpectanimpairmentaspricesstabilise,andstrongerprofitabilityfromhigher-endprojects 13-27% earnings upside for 2026-28e; +1ppt implies 26-54% upside on average. The potentialupside is skewed towards mid-sized developers, where earnings bases have been reset tocycle lows in 2024-25. C&D, supported by higher-margin luxury exposure and lower impairment risk. recovery is still city-and segment-specific,and the wider macro backdrop stll creates noise andvolatility for sentiment and broader-based rebound (Residential resilience vs retail resistance.17 June 2026). Our constructive view is mainly based on: in the secondary market, where years of price correction and supportive mortgage rates havelifted affordabilityto a 10-yearhigh (Demand reawakens:Affordability at a decade-best level,26 May 2026). Stronger resale liquidity is also creating a positive feedback loop, supportingownership demand as risk appetite improves (From 'exit'to 'upgrade'- why resale liquiditymatters, 24 March 2026). In the primary market, projects aimed at upgraders and luxury buyers continue to outperform.Upcoming luxury launches are likely to further underpin sentiment and reinforce improving pricedynamics (Widening winners'circle in 1H26: 2H gets easier, 2 July 2026). 2)