Core view
Market review this week. In the fourth week, the real estate sector index was stronger than the CSI 300 index and weaker than the gem index. The relative return of the real estate sector compared with the CSI 300 index was + 0.3%. The CSI 300 index closed at 4563.77, with a weekly increase of – 4.5%; The gem index closed at 2908.94, with a weekly increase of – 4.1%; The real estate sector index closed at 3328.14, with a weekly increase of – 4.2%.
Industry highlights this week. According to the latest data disclosed by the Ministry of housing and urban rural development, 56000 old urban communities will be reconstructed in 2021. In 2021, China’s infrastructure REITs issued a total of 11 projects, and nearly 100 projects have been promoted at present. Xiamen issued new regulations on the pre-sale of commercial housing, further strengthened the supervision of pre-sale funds, and revised it to the supervision mode of “retention before use”. China Resources Land, China Resources Vientiane life and China Merchants Bank signed 23 billion M & A financing strategic cooperation. Clubmed Changbai Mountain Tourism Co.Ltd(603099) resort, the third ice and snow resort in China, opened. Asia’s first indoor Nick paradise settled in Chongqing.
Sales of new houses this week increased compared with last week, while sales of second-hand houses decreased compared with last week. In the fourth week, the sales of new houses in 29 major cities was 30000 units, an increase of 3.1% over the third week; In 11 major cities, 7000 sets of second-hand houses were sold, a decrease of 13.7% compared with the third week; Compared with the third week, the growth rates of new housing and second-hand housing transactions in first tier cities were 22.1% and – 4.6% respectively; Compared with the third week, the growth rates of new housing and second-hand housing transactions in second tier cities were – 13.4% and – 20.7% respectively. The inventory increased compared with last week, and the inventory sales increased compared with last week. As of the fourth week, the inventory of 15 major cities was 1233000 sets, an increase of 1000 sets compared with the third week; The stock to sales ratio was 13.3 months, an increase of 0.2 months over the third week. The land market transfer heat this week is lower than last week. In the fourth week, a total of 8 pieces of land were sold in 26 major cities, a decrease of 32 pieces compared with last week. The amount of land transfer decreased. In the fourth week, the land transfer fee of 26 major cities was 4.36 billion yuan, a decrease of 20.1 billion yuan compared with the third week. The average premium rate decreased. In the fourth week, the average premium rate of land transactions in 26 major cities was 0.2%, 3 percentage points lower than that in the third week. In the fourth week, the number of land auction in 26 big cities was 0.
Announcement of key companies. China Vanke Co.Ltd(000002) , China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) completed the issuance of medium-term tickets. Poly Developments And Holdings Group Co.Ltd(600048) complete the executive shareholding increase plan. China Fortune Land Development Co.Ltd(600340) , Jiangsu Zhongnan Construction Group Co.Ltd(000961) , Yango Group Co.Ltd(000671) , Guangzhou Pearl River Industrial Development Co.Ltd(600684) , Jinan High-Tech Development Co.Ltd(600807) , Zhe Jiang Dong Ri Limited Company(600113) , Tianjin Jinbin Development Co.Ltd(000897) , Langfang Development Co.Ltd(600149) , Yang Guang Co.Ltd(000608) , Beih-Property Co.Ltd(600791) , Casin Real Estate Development Group Co.Ltd(000838) , Citychamp Dartong Co.Ltd(600067) released the performance forecast for 2021.
Investment proposal and investment object
After the rise of A-share real estate stocks since the new year of 2022, while the uncertainty in the overseas market has increased significantly, investors hope to see more real estate support policies from top to bottom. This week, several real estate companies released performance forecasts, predicting a loss or sharp decline in 2021. We believe that the current industry fundamentals are still inertia downward. At the same time, low and medium rated real estate enterprises are still in the dilemma of debt crisis, and the existing policies can not improve their credit status. The M & A of high rated real estate enterprises may play a role in relieving the crisis, The policy is expected to be more relaxed. Under this combination of fundamentals and policies, we focus on the valuation repair of real estate enterprises with financial security in the short term. We are optimistic about the first-line leaders with stable performance, and recommend Poly Real Estate (600048, buy), China Vanke Co.Ltd(000002) (00000 2, buy); Second tier leaders with flexible performance are recommended Gemdale Corporation(600383) (600383, buy) and Longhu group (00960, buy). At the same time, we are optimistic about the property management and business management industries with rapid growth and strong consumption attributes. We recommend Country Garden Service (06098, buy), poly property (06049, buy), China Merchants Property Operation & Service Co.Ltd(001914) (001914, overweight), New Dazheng Property Group Co.Ltd(002968) (002968, buy), rongchuang service (01516, buy) and Xingsheng Commerce (06668, buy).
Risk tips
Sales were significantly lower than expected. The counter cyclical policy was less than expected. Interest rates have risen significantly.
