China Communications Construction (1800.HK): Model Update Post Worsening FAI during 5M26

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China Communications Construction (1800.HK): Model Update Post Worsening FAI during 5M26

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28 Jun 2026 09:09:45 ET │ 17 pages

China Communications Construction

(1800.HK)

Model Update Post Worsening FAI during 5M26

CITI'S TAKE

After the sharp deterioration of FAI run rate from -1.6% during 4M26 to - Neutral

4.1% yoy during 5M26, we reduce our earnings estimates by 34-375 during Price (26 Jun 26 16:10) HK$3.70

2026-27E and introduce 2028E forecast. One of the primary drags was

property sector falling 16.2% during 5M26 vs -13.7% in 4M26. This weaker Target price HK$4.00↓

property FAI would dampen CCCC on real estate development and housing from HK$6.00

construction. We therefore reduce TP to Rmb4 accordingly, from prior Expected share price return 8.1%Rmb6, based on the same 4x PE for 2027E. This is backed by 3-yr EPS

CAGR of 7% through 2028E. We maintain Neutral on CCCC given its Expected dividend yield 5.4%

highest % of rev exposure to financial-dependent PPP projects. We prefer Expected total return 13.5%

CSCI > CRG and are Neutral on CCCC for the China infra construction Market Cap HK$60,006Msector.

US$7,653M

Official guidance seems too optimistic – CCCC officially gives guidance of 2026

revenue growth at 6.8% this year. This looks quite optimistic due to the worsening

FAI datapoint during the first 5M26. We model 2% growth only for this

year. Company targets order growth at 2-3% to Rmb1.933tn for 2026E. The modest Price Performance

order growth target reflects a cautious stance on the domestic FAI owing to (RIC: 1800.HK, BB: 1800 HK)

tightening govt balance sheet. In addition, we expect a slowdown in growth in

overseas infra market for lower financing resources to bid mega infra projects.

(Continued)

Eric Lau AC

+852-2501-2726