Daiwa pointed out that the net property income of Hongfu Industrial Trust (0808.HK) increased 2.7% from the previous year to HK $212.5 million, with an allocation of HK $0.1101 per fund unit, an increase of 0.3% over the previous year. Daiwa said that the net property income and distribution per fund unit were in line with the bank's expectations.
Daiwa pointed out that the increase in net property income was mainly due to the fact that the overall property rental rate reached a new high of 99.5% at the end of 2010, up 2.1% from 97.4% at the end of 2009.
Daiwa maintains its rating of outperforming the market, with a target price of HK $2.10. Due to the bright future of the office market and the continued increase in the asset value of Hongfu, the rental level of the Daiwa property portfolio is expected to rise further.
Hongfu Industrial Trust closed flat at HK $1.93 on Friday.