Our target price for Agile of HK$0.53 is set at 80% discount to FY25E NAV. Our target discount to NAV is at par of historical average for Agile and in line with discounts applied to names with weaker execution, stretched B/S, or seeking debt extension / restructuring. 

Discount to NAV is the most widely used method to value Hong Kong and China property stocks. NAV measures the value of a stock based on the market value of its assets; for a property company those would be its development and investment properties. The NAV discount is then adjusted for the 'realizability' of those assets and growth potential in that NAV; the more realizable the NAV is, or the larger the growth potential the NAV carries, the lower the discount to NAV should be.

Our estimated FY25E NAV is HK$2.64, which factors in our assumptions for its property completion schedules, sales pipeline, and ASPs.  

We assign a High Risk rating to Agile given share price volatility and the need for more efforts to improve the company's balance sheet and debt control, especially with declining sales.

Downside risks that could impede the stock from reaching our target price relate principally to the property market in China. With regard to economic risks, weaker-than-expected growth globally and/or in China could negatively affect buying sentiment in China’s property market, which could render our sales and earnings estimates for Agile inaccurate. 

Upside risks that could mean the stock trades above our target price include a favorable policy environment and better-than-expected sales growth.