Henderson Land (0012.HK): 1H26 results above on strong DP profit recovery and farmland resumption gain. No intention to cut prices to clear inventory

Research evidence excerpt

Equity Research

21 August 2026 | 6:41AM HKT

Henderson Land (0012.HK)

1H26 results above on strong DP profit recovery and farmland resumption gain. No

intention to cut prices to clear inventory

0012.HK

12m Price Target: HK$41.00

Price: HK$28.18

Upside: 45.5%

Henderson Land reported headline net profit of HK$4.1bn in

1H26. Excluding -HK$1bn fair value loss mostly related to its

mainland China rental properties (IP), its underlying profit

jumped +66% yoy to HK$5.1bn, well above our and market

expectation, mainly boosted by a HK$1.6bn pre-tax gain on

farmland resumption by the government (vs. HK$240mn in

1H25) and strong-than-expected HK development property (DP)

profit booking of HK$1.7bn pre-tax (vs. a modest HK$70mn in

1H25). After several years of decline, group attributable EBIT

(including share of associates and JVs) turned around and recovered

by +45% yoy to HK$7bn, driven by much higher DP profit with a

tripling of revenue recognition (HK$13.3bn vs. HK$3.8bn in 1H25)

and healthy margin recovery (18.3% vs. 2.1% in 1H25) in HK.

Contribution from HK & China Gas also grew +10% yoy to

Rmb2.1bn (vs. flat in FY25) on an increase in sustainable aviation

fuel (SAF) volume following the commencement of its Malaysian

plant in late-2025. This was partly offset by wider EBIT loss from

mainland China DP (-HK$0.4bn vs. -HK$0.1bn in 1H25) dragged by

a one-off JV transaction to sell certain units at below-market price

in order to acquire a land site, per mgmt. Elsewhere, EBIT from its IP

portfolio was quite steady +1% yoy to HK$3.4bn with improving

rental trend in HK esp. in core Central district (+4% vs. flat in 2H25)

while its mainland China portfolio continued to posted rental

decline (-10% yoy) amid ongoing challenges from an over-supply

office market.

BUY CL

Simon Cheung, CFA

Goldman Sachs (Asia) L.L.C.

Alpha Wang

Goldman Sachs (Asia) L.L.C.

Zhaoheng Chen

Goldman Sachs (Asia) L.L.C.

Key Data _____________________________________

Market cap: HK$136.4bn / $17.4bn

Enterprise value: HK$195.7bn / $25.0bn

3m ADTV: HK$239.7mn / $30.6mn

Hong Kong

HK Property & Greater China Conglo

M&A Rank: 3

Leases incl. in net debt & EV?: No

GS Forecast __________________________________

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