Shares of WHARF REIC (01997) climbed 5% in morning trading to HK$31.50, with a trading volume of HK$336 million, after the company's first-half results surpassed expectations and included a dividend increase. The stock had previously surged nearly 7% intraday, following a sharp rally of almost 32% the previous afternoon.

The company reported first-half revenue of HK$6.34 billion, down 1.05% year-on-year, while net loss attributable to shareholders narrowed by 92.69% to HK$176 million. It declared a first interim dividend of HK$0.94 per share, a 42% year-on-year increase.

Notably, based on current profitability and debt levels, the group announced a dividend payout ratio increase from 65% to 90% of recurring core net profit, representing a 38% rise in the underlying dividend. According to CLSA, the 2026 first-half performance exceeded expectations, with the payout ratio hike to 90% reflecting management's strategy to convert previously nondistributable profits into distributable cash flow after selling Singapore's Wheelock Place, thereby enhancing shareholder returns.

CLSA noted that WHARF REIC has been its top pick in the Hong Kong property sector since March, citing significant exposure to the luxury home sales recovery cycle and recent minority-friendly actions that help narrow the net asset value discount and drive revaluation.