SHENZHEN INT'L (00152) saw its shares decline nearly 5% in the late trading session. As of the time of writing, the stock was down 4.58% to HK$5.11, with trading volume reaching HK$59.74 million.

According to the company's interim results, revenue for the first half amounted to HK$8.23 billion, representing a year-on-year increase of 23.4%. However, the company reported a net loss attributable to shareholders of HK$221 million, swinging from a profit to a loss compared to the same period last year.

Where the pressure lies

Analysts at Huatai Securities pointed out that the significant decline in first-half net profit was primarily driven by a fair value loss of HK$331 million on investment properties, alongside a turnaround to losses at the group's 50%-owned associates. These factors collectively reduced the net profit contribution from the logistics park transformation segment by HK$444 million year-on-year.

The brokerage noted that due to weak short-term earnings, the company's share price and valuation have come under pressure recently. Looking ahead, however, analysts believe that as new projects such as the Pinghu South project mature, the company's core operations could stabilize and recover. Additionally, the remaining land transformation gains from the South China Logistics Park and potential property sales proceeds are expected to remain substantial, potentially driving a return to profitability by the second half of 2026 and contributing consistently to earnings thereafter.

If the company maintains its dividend payout ratio at 50%, based on the closing price on August 28, the projected dividend yield for 2026 could reach 7.1%, which is already beginning to look attractive to investors.