Goldman Sachs: Lowers New World target price to 5.1 Hong Kong dollars, no dividends expected until fiscal year 2027

Golden Ten Data reported on January 13 that Goldman Sachs issued a research report pointing out that in the past two months, New World Development (00017. HK) share price and bond price have fallen by about 40% and about 30% respectively, which is believed to reflect the market’s concerns about the sustainability of the company’s current debt level and its recovery path. Goldman Sachs has revised its earnings per share forecast for New World this year to 2027, down 140%, 87% and 45%, respectively, and is not expected to pay dividends until fiscal 2027 as the group focuses on deleveraging. The bank lowered its target price to HK$5.1 from HK$5.8 and maintained a “sell” rating. The bank pointed out that the group said that it aims to sell 13 billion yuan of non-core assets this year, and that more asset sales may be required if it is to achieve a net reduction in debt level and capital leverage, assuming that there is no material change in the group’s efficiency and return on assets.