# Wharf Real Estate Investment (1997.HK)

Canonical: https://gigainvestors.com/s/1997.HK

Analysis as of: 2026-10-16T07:35:37.629Z. Financial observations: FY2014–FY2025.

Listing currency: HKD. Reporting currency: HKD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: HKD 30.48 per share; close as of 2026-10-15.

Estimated value: low HKD 4.46 per share, central HKD 4.99 per share, high HKD 5.71 per share. Buy at or below the central value HKD 4.99 per share. Valuation as of 2026-10-16T07:35:37.629Z; scenarios are not confidence intervals.

Expected annual return: 4.0% at the stated quote. About 4.0% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; HK 10-year bond 4.0% + 4 points).

## Checklist

### understandable: fail

- 7 revenue declines in the last 10 years

- more than 5 revenue declines in ten years

- more than 2 net loss years

- Financial history: 10 years

- Years with declining revenue: 7

- Years with a net loss: 3

- Operating margin variation: 0.09×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.70×

- FY2017: 0.74×

- FY2018: 0.77×

- FY2019: 0.79×

- FY2020: 0.64×

- FY2021: 0.56×

- FY2022: 0.71×

- FY2023: 0.75×

- FY2024: 0.75×

- FY2025: 0.73×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 3.4%

- ROIC, second-lowest year: 2.8%

- Typical minus recent gross margin: 0.1 pp

- Typical gross margin (annual median): 78.4%

- Recent gross margin (lower of latest and 3-year median): 78.3%

- Years with nonpositive capital: 0

- Capital spending / revenue: 0.4%

- ROIC including acquisitions, ten-year median: 1.7%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 4.4%

- FY2017: 5.0%

- FY2018: 4.4%

- FY2019: 3.3%

- FY2020: 3.1%

- FY2021: 2.6%

- FY2022: 3.0%

- FY2023: 3.5%

- FY2024: 2.8%

- FY2025: 3.5%

### economics: fail

- owner earnings cash conversion below threshold

- incremental invested capital return below threshold

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: HKD -2.1B

- Net income, five-year total: HKD -3.1B

- Return on incremental invested capital: 0.0%

- Working capital / revenue, annual change: -0.7 pp

- Working capital / revenue, change between three-year averages: -3.6 pp

- Working capital / revenue, final three-year average: 5.9%

Chart: Owner earnings · five years; fiscal year observations.

- FY2021: HKD 4.5B

- FY2022: HKD -8.6B

- FY2023: HKD 5.0B

- FY2024: HKD 1.1B

- FY2025: HKD -4.1B

### management: fail

- Historical market-dollar context (not the management verdict): 2017 to 2025 (8 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 4.4% vs 3.5%

- Per-share earnings: 4.54 to 0.29 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -0.0%

- Ordinary dilution, 5-year annual growth: 0.0%

- Market cap gain: HKD -83B

- Cumulative retained earnings: HKD -25B

- Diluted shares, 10-year annual growth: -0.0%

- Diluted shares, 5-year annual growth: 0.0%

- $1 test, starting fiscal year: FY2017

- $1 test, ending fiscal year: FY2025

- Per-share value growth: -29.0%

- Per-share value change: HKD -4.25

- Per-share value, starting three-year median: HKD 4.54

- Per-share value, ending three-year median: HKD 0.29

- Buyback history: 0 years

- Debt-funded buybacks: No

- Acquisition spending: HKD 1.7B

- Cumulative net income, 10 years: HKD 38B

- ROIC, first three-year median: 4.4%

- ROIC, last three-year median: 3.5%

Chart: Earnings per share; fiscal year observations.

- FY2016: HKD 3.27

- FY2017: HKD 5.67

- FY2018: HKD 5.94

- FY2019: HKD 1.29

- FY2020: HKD -2.59

- FY2021: HKD 1.45

- FY2022: HKD -2.92

- FY2023: HKD 1.57

- FY2024: HKD 0.29

- FY2025: HKD -1.40

### accounting: pass

- Sloan accruals: -4.8%

- Receivables to sales index (DSRI): 0.86×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.1%

- Earnings backed by cash: Yes

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.00×

Chart: Sloan accruals; fiscal year observations.

- FY2016: -0.5%

- FY2017: 2.8%

- FY2018: 3.0%

- FY2019: -2.8%

- FY2020: -4.6%

- FY2021: -1.3%

- FY2022: -6.1%

- FY2023: -0.4%

- FY2024: -2.3%

- FY2025: -4.8%

## Holders

## Price story

Down 33% since Dec 2022 · sales -0.8%

Story as of 2026-10-16T10:00:05.693Z; price observation 2026-10-15.

Price needs cash profits to grow 25.6% a year for ten years

### Sales · FY2024–2025

sales -0.8%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: HKD 17B 

- FY2017: HKD 21B 

- FY2018: HKD 16B 

- FY2019: HKD 16B 

- FY2020: HKD 16B 

- FY2021: HKD 16B 

- FY2022: HKD 12B 

- FY2023: HKD 13B 

- FY2024: HKD 13B 

- FY2025: HKD 13B 

### Gross margin · FY2025

gross margin 78.3%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2016: 74.8% 

- FY2017: 78.5% 

- FY2018: 82.5% 

- FY2019: 83.2% 

- FY2020: 69.9% 

- FY2021: 64.7% 

- FY2022: 77.8% 

- FY2023: 80.3% 

- FY2024: 80.1% 

- FY2025: 78.3% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in real estate services; annual sales are HKD 12.8 billion.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2025-12-31 (filed 2026-10-16T07:35:37.629Z); FY2025: revenue 12815000000; grossProfit 10034000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 1997.HK: Wharf Real Estate Investment Company Limited, an investment holding company, develops, owns, and operates properties and hotels in Hong Kong, Mainland China, and Singapore. It operates through Investment Properties, Development Properties, Hotel, and Investment segments. The company's properties include Harbour City, a commercial space comprising offices, retail shops, serviced apartments, hotels and clubs, and car parking spaces; and Times Square, a retail space that consists of office and car parking spaces. It also owns and operates the Wheelock House and Crawford House commercial properties; The Murray hotel; Plaza Hollywood, a shopping mall with shops, restaurants, and a cinema multiplex; The Star Ferry, which operates two inner harbor ferry services; and Wheelock Place and Scotts Square malls. In addition, the company engages in the leasing and management of retail and office properties, and serviced apartments; property and equity investments; and provision of leasing, finance, treasury, public transport, and management services. The company was founded in 1886 and is headquartered in Kowloon, Hong Kong.

### Why customers stay

Margins ranged from 78.3% to 80.3% during 2023–25; it earns 3.4% on its capital.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2023-12-31 (filed 2026-10-16T07:35:37.629Z); FY2023: grossProfit / revenue = 80.3%.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2024-12-31 (filed 2026-10-16T07:35:37.629Z); FY2024: grossProfit / revenue = 80.1%.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2025-12-31 (filed 2026-10-16T07:35:37.629Z); FY2025: grossProfit / revenue = 78.3%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:35:37.629Z); 10-year return on capital observations [[2016,0.043521371611107],[2017,0.04991544548953826],[2018,0.04442455553821558],[2019,0.033002861871855096],[2020,0.03070780179990568],[2021,0.02620249955611517],[2022,0.029656069940937443],[2023,0.03524700224678402],[2024,0.028368160324251296],[2025,0.034563539789877626]]; median 0.03378320083086636. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 10 of 10 years.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2016-12-31 (filed 2026-10-16T07:35:37.629Z); FY2016: growth capex 0; upkeep 1017000000; owner earnings 9076000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2017-12-31 (filed 2026-10-16T07:35:37.629Z); FY2017: growth capex 1504000000; upkeep 144000000; owner earnings 17218000000. Growth capex / owner earnings = 0.0873504472064119.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2018-12-31 (filed 2026-10-16T07:35:37.629Z); FY2018: growth capex 0; upkeep 43000000; owner earnings 18276000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2019-12-31 (filed 2026-10-16T07:35:37.629Z); FY2019: growth capex 0; upkeep 65000000; owner earnings 4153000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2021-12-31 (filed 2026-10-16T07:35:37.629Z); FY2021: growth capex 0; upkeep 196000000; cash acquisitions 1000000; owner earnings 4525000000. Growth capex plus acquisitions / owner earnings = 0.00022099447513812155.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2023-12-31 (filed 2026-10-16T07:35:37.629Z); FY2023: growth capex 0; upkeep 50000000; cash acquisitions 0; owner earnings 4962000000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/1997.HK.json#2024-12-31 (filed 2026-10-16T07:35:37.629Z); FY2024: growth capex 0; upkeep 41000000; cash acquisitions 0; owner earnings 1087000000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:35:37.629Z); Dividend observations: [[2016,15753000000],[2017,10205000000],[2018,6072000000],[2019,6528000000],[2020,5192000000],[2021,4129000000],[2022,4068000000],[2023,3886000000],[2024,3795000000],[2025,3826000000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 49.1% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); 1997.HK SharesStats.PercentInsiders = 49.059000000000005 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits grow 25.6% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:35:37.629Z); Ten-year compound average after fade. Initial solved rate 0.36079665348219214. Price 30.48; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 4.480379640578127 → FY2025 -1.3432147562582346. Closing-price date 2026-10-15.

## Monthly share-price history (HKD per share)

- 2017-11: HKD 47.20 per share

- 2017-12: HKD 52.00 per share

- 2018-01: HKD 54.05 per share

- 2018-02: HKD 53.20 per share

- 2018-03: HKD 51.10 per share

- 2018-04: HKD 59.00 per share

- 2018-05: HKD 60.55 per share

- 2018-06: HKD 55.85 per share

- 2018-07: HKD 57.15 per share

- 2018-08: HKD 52.05 per share

- 2018-09: HKD 50.50 per share

- 2018-10: HKD 48.55 per share

- 2018-11: HKD 47.05 per share

- 2018-12: HKD 46.85 per share

- 2019-01: HKD 53.50 per share

- 2019-02: HKD 55.15 per share

- 2019-03: HKD 58.45 per share

- 2019-04: HKD 60.10 per share

- 2019-05: HKD 53.55 per share

- 2019-06: HKD 55.05 per share

- 2019-07: HKD 49.70 per share

- 2019-08: HKD 42.45 per share

- 2019-09: HKD 42.80 per share

- 2019-10: HKD 46.20 per share

- 2019-11: HKD 43.45 per share

- 2019-12: HKD 47.55 per share

- 2020-01: HKD 40.50 per share

- 2020-02: HKD 35.35 per share

- 2020-03: HKD 31.90 per share

- 2020-04: HKD 32.75 per share

- 2020-05: HKD 29.80 per share

- 2020-06: HKD 37.00 per share

- 2020-07: HKD 27.40 per share

- 2020-08: HKD 32.25 per share

- 2020-09: HKD 31.50 per share

- 2020-10: HKD 29.75 per share

- 2020-11: HKD 36.05 per share

- 2020-12: HKD 40.35 per share

- 2021-01: HKD 41.15 per share

- 2021-02: HKD 46.35 per share

- 2021-03: HKD 43.55 per share

- 2021-04: HKD 44.70 per share

- 2021-05: HKD 45.50 per share

- 2021-06: HKD 45.15 per share

- 2021-07: HKD 43.85 per share

- 2021-08: HKD 38.55 per share

- 2021-09: HKD 40.30 per share

- 2021-10: HKD 43.90 per share

- 2021-11: HKD 39.50 per share

- 2021-12: HKD 39.60 per share

- 2022-01: HKD 36.95 per share

- 2022-02: HKD 35.05 per share

- 2022-03: HKD 38.85 per share

- 2022-04: HKD 37.15 per share

- 2022-05: HKD 37.90 per share

- 2022-06: HKD 37.40 per share

- 2022-07: HKD 34.90 per share

- 2022-08: HKD 35.80 per share

- 2022-09: HKD 35.70 per share

- 2022-10: HKD 30.95 per share

- 2022-11: HKD 36.00 per share

- 2022-12: HKD 45.50 per share

- 2023-01: HKD 44.80 per share

- 2023-02: HKD 43.00 per share

- 2023-03: HKD 45.10 per share

- 2023-04: HKD 45.10 per share

- 2023-05: HKD 38.65 per share

- 2023-06: HKD 39.15 per share

- 2023-07: HKD 41.75 per share

- 2023-08: HKD 32.70 per share

- 2023-09: HKD 30.25 per share

- 2023-10: HKD 27.35 per share

- 2023-11: HKD 24.65 per share

- 2023-12: HKD 26.40 per share

- 2024-01: HKD 22.90 per share

- 2024-02: HKD 26.15 per share

- 2024-03: HKD 25.45 per share

- 2024-04: HKD 24.45 per share

- 2024-05: HKD 22.65 per share

- 2024-06: HKD 20.70 per share

- 2024-07: HKD 19.22 per share

- 2024-08: HKD 22.75 per share

- 2024-09: HKD 27.50 per share

- 2024-10: HKD 23.30 per share

- 2024-11: HKD 20.85 per share

- 2024-12: HKD 19.86 per share

- 2025-01: HKD 19.34 per share

- 2025-02: HKD 20.30 per share

- 2025-03: HKD 18.92 per share

- 2025-04: HKD 18.60 per share

- 2025-05: HKD 19.66 per share

- 2025-06: HKD 22.20 per share

- 2025-07: HKD 24.95 per share

- 2025-08: HKD 22.60 per share

- 2025-09: HKD 23.00 per share

- 2025-10: HKD 22.10 per share

- 2025-11: HKD 24.56 per share

- 2025-12: HKD 24.58 per share

- 2026-01: HKD 27.18 per share

- 2026-02: HKD 28.90 per share

- 2026-03: HKD 22.62 per share

- 2026-04: HKD 24.34 per share

- 2026-05: HKD 24.04 per share

- 2026-06: HKD 21.38 per share

- 2026-07: HKD 26.58 per share

- 2026-08: HKD 30.86 per share

- 2026-09: HKD 30.52 per share

- 2026-10: HKD 30.48 per share

## Annual estimated value (HKD per share)

- FY2018: low HKD 49.65 per share, central HKD 56.38 per share, high HKD 65.35 per share

- FY2019: low HKD 45.88 per share, central HKD 52.09 per share, high HKD 60.35 per share

- FY2020: low HKD 30.73 per share, central HKD 34.88 per share, high HKD 40.40 per share

- FY2021: low HKD 16.78 per share, central HKD 19.02 per share, high HKD 22.01 per share

- FY2022: low HKD 11.84 per share, central HKD 13.43 per share, high HKD 15.53 per share

- FY2023: low HKD 12.59 per share, central HKD 14.29 per share, high HKD 16.55 per share

- FY2024: low HKD 4.26 per share, central HKD 4.80 per share, high HKD 5.52 per share

- FY2025: low HKD 4.47 per share, central HKD 5.00 per share, high HKD 5.72 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.