MTR Corporation (0066) chairman Rex Auyeung Pak-keun yesterday said he believes the real estate market's sentiment has brightened, following recent satisfactory sales at the rail operator's projects.
Speaking at MTRC's annual general meeting yesterday Auyeung said that 14,000 residential units will be launched across several years and MTRC will retender the Tung Chung East project in the next 12 months after the company failed to receive any bids last year.
It is currently developing 14 projects. The main works of the Hung Shui Kiu Station project will start this year, the Northern Link project will begin in 2025, and Oyster Bay Station is expected to be completed in 2030.
Outside Hong Kong, the company will remain oriented toward rail services.
Regarding the extension of the East Rail Line into Shenzhen, Auyeung said discussions are still under way with the mainland and the MTRC would fully cooperate when the proposal is finalized.
In response to a question about why the company's share price is at a low level, finance director Michael Fitzgerald said MTR passenger capacity has yet to recover to pre-pandemic levels, accompanied by the overall downturn of the Hong Kong stock market, the price is impacted by cautious sentiment. But he added that the share price has picked up. In the past month, MTRC's shares have climbed from HK$24.1 to HK$28.9.
Managing director Jeny Yeung Mei-chun said that with the expansion of the railway, the depreciation rate of fixed assets would increase.
Last year, the MTRC announced a HK$65 billion investment in asset renewal and maintenance, as well as innovative technology to enhance service quality.
As to new rail projects, which have already started with a HK$100 billion investment, they will be followed by other projects, according to chief executive Jacob Kam Chak-pui.
Meanwhile, ticket revenue is expected to increase no more than 3.09 percent this year. The nominal wage index of the transport sector released by the Census and Statistics Department this year increased by 5.2 percent.
If all the data are incorporated into the fare equation, MTRC can increase its fares by 5.05 percent. However, only 3.09 percent of the final increase can be raised under the cap mechanism, while the remaining 1.96 percent may be delayed.
The Tung Chung East project will be retendered in the next 12 months. Sing Tao
