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VIC [M-PF -2%] - VIC’s dilemma: mismatch of capabilities and market dynamics - Update

We change our rating for VIC from BUY to M-PF as the stock has jumped to reach our previous target while losses from its retail businesses drag on profits from property development. High-end residential demand is peaking while supply continues to grow. After a 160% surge in transaction volume in 2015, there is clear evidence the high-end market has peaked and a gradual decline in 2016 and 2017 should be expected.