Daiwa published a research report stating that it reiterates CKI HOLDINGS (01038) with a Target Price of HKD 63, and upgrades the rating from 'Outperform Market' to 'Buy'.

The report states that the group is the only Hong Kong utility company predicted to achieve year-on-year growth in dividends per share from 2024 to 2026. Additionally, the Federal Reserve may slow the pace of interest rate cuts, and compared to Hong Kong Utilities Industry, the mainland business is relatively lower.

The bank pointed out that the United Kingdom's Water Affairs regulator (Ofwat) released the final decision on the 2024 price review (PR24) yesterday, which was surprising. Considering the market views Thames Water as a potential merger candidate for the group, the bank believes the PR24 decision increases this potential.