UBS has released a research report stating that KE Holdings Inc. (02423) serves as a proxy for China's property market cycle, and the market is overlooking its operational improvements during the five-year downturn in the property market. The bank reiterates its "Buy" rating and raises its price target from HK$66 by 5% to HK$69.4, with the new target price equivalent to 17 times the projected price-to-earnings ratio for 2027.

The bank noted that KE Holdings Inc. (02423) has strengthened agent productivity, platform capabilities, and cost efficiency, as evidenced by its second-quarter results. As mainland property prices stabilize and changes to pre-sale policies bring benefits to second-hand home transactions, investors are expected to focus more on KE Holdings Inc.'s (02423) potential excess returns rather than solely on property market transaction volumes.

The third-quarter results, scheduled to be announced in mid-November, could serve as a catalyst. Based on higher agent productivity (contributing to profit margins) and higher gross transaction value for second-hand homes, the bank has raised its earnings forecasts for KE Holdings Inc. (02423) for 2026, 2027, and 2028 by 4%, 13%, and 28%, respectively.