Current investment tips:
The performance of a large number of enterprises in the sector has been pre reduced, and the performance differentiation between real estate enterprises has intensified. Since the second half of 2021, sales and investment have continued to decline more than expected. On the one hand, the supply side regulation policies such as three red lines, loan concentration management and pre-sale fund supervision have been continuously tightened. On the other hand, the demand side regulation policies such as purchase and loan restrictions have continued to be under high pressure, which has led to a rapid decline in the cash flow of real estate enterprises at the financing end and sales end. Superimposed on the centralized maturity of domestic and foreign debts from 2021 to 2022, the real estate industry has encountered financial difficulties. We expect the fundamentals of the real estate industry to continue to show a downward trend, but we believe that the accelerated liquidation of the industry and the reduction of competition among real estate enterprises will promote the transition from the previous involution concentration to the concentration of pattern optimization, and high-quality real estate enterprises are expected to usher in both quantity and quality. Looking forward to the performance of the sector in 2021, we believe that the tight funds of real estate enterprises on the income side affect the completion and settlement progress, and the tightening of land acquisition side leads to the decline of future sales and settlement certainty; Superimposed on the profit side, considering that the high price land in the early stage has not been settled, the gross profit margin is expected to continue to decline in 2021, which comprehensively promotes the performance of the sector. At present, a large number of enterprises have issued performance pre reduction announcements, and it is expected that the performance differentiation among enterprises will further intensify.
Land acquisition, construction and completion have weakened in an all-round way, and industry sales are still depressed. On the one hand, the industry data continued to decline more than expected. In December of 21, the investment was – 13.9% year-on-year, compared with the previous value of – 9.6pct; The year-on-year start-up was – 31.1%, compared with the previous value of -10.1pct; The sales amount was – 17.8% year-on-year, compared with the previous value of -1.5pct; The average sales price was – 2.5% year-on-year, compared with the previous value of + 0.2pct In January, the monthly sales amount of 50 real estate enterprises was – 36% year-on-year, down from the previous value of – 1PCT; It is worth noting that in the list of the top 50 real estate enterprises we tracked, there was no data update for Evergrande, capital real estate, jiazhaoye and Xinli in January. Considering the sales data of the insured real estate enterprises, the actual sales of real estate enterprises in January decreased more year-on-year. The sales performance of real estate enterprises continued to be sluggish in January 22, and fell sharply for six consecutive months, which is relatively rare in history. The main reasons are as follows: 1) the market continued to weaken, and after half a year, the market expectation was pessimistic and the demand was weak; 2) The further shortage of industry funds led to the continuous price reduction of real estate enterprises; 3) Increase the expectation of the real estate market; 4) In January this year, some Spring Festival holidays dragged down the impact, while last February was the Spring Festival month. In addition, we maintain a year-on-year forecast of – 9.1% for sales area and – 9.1% for sales amount in 22 years.
Combined with the performance forecast and express report, we expect the net profit attributable to the parent company of key industry companies in 2021 to be as follows:
1) companies with growth rate of 0% or above: New Dazheng Property Group Co.Ltd(002968) (announcement hub + 27%), Huafa Industrial Co.Ltd.Zhuhai(600325) (announcement + 10%), Gemdale Corporation(600383) , China Merchants Property Operation & Service Co.Ltd(001914) , Longhu group, China Resources Land, China overseas development, Xiamen C&D Inc(600153) ; 2) Companies with a growth rate of – 20% ~ 0%: Poly Developments And Holdings Group Co.Ltd(600048) (announcement – 5%), Seazen Holdings Co.Ltd(601155) , China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) , Jinke Property Group Co.Ltd(000656) ; 3) Companies with a growth rate of – 50% – 20%: Greenland Holdings Corporation Limited(600606) (announcement – 49%), China Vanke Co.Ltd(000002) ; 4) Companies with growth rate below – 50%: Beijing Capital Development Co.Ltd(600376) (announcement – 76%), Jiangsu Zhongnan Construction Group Co.Ltd(000961) (announcement Center – 80%), Risesun Real Estate Development Co.Ltd(002146) (announcement Center – 98%), Yango Group Co.Ltd(000671) (announcement loss), China Fortune Land Development Co.Ltd(600340) (announcement loss).
Investment analysis opinion: a large number of real estate enterprises’ performance is expected to be reduced, the differentiation is intensified, the pattern is optimized, and the “optimistic” rating is maintained. From the perspective of the old cycle framework, the central bank has continuously stressed the maintenance of stability in real estate and the prevention and control of financial risks. The Politburo meeting and the central economic work meeting set the tone to support reasonable housing demand. The government’s warmth of maintaining stability has been realized, and the industry elasticity (beta) of policy restoration still deserves attention; From the perspective of the new cycle framework, under the dual role of the industry’s capital dilemma and the deepening of supply side regulation, the industry clearing accelerates the reduction of competition and promotes the transition of the industry from the previous involution concentration to the concentration of pattern optimization. High quality real estate enterprises are expected to usher in a double increase in quantity and quality, or even double-click. The growth force (alpha) under pattern optimization is more worthy of expectation. We maintain the “optimistic” rating of the real estate sector. Recommendations: A shares: Poly Developments And Holdings Group Co.Ltd(600048) , Gemdale Corporation(600383) , China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) , Seazen Holdings Co.Ltd(601155) , Jinke Property Group Co.Ltd(000656) , China Vanke Co.Ltd(000002) ; H shares: Longhu group, China Resources Land, China overseas development, Xuhui holdings, country garden and rongchuang China; And maintain the “optimistic” rating of the property management sector, and recommend: Country Garden service, China Resources Vientiane, Xuhui Yongsheng service, poly property, CNOOC property, New Dazheng Property Group Co.Ltd(002968) , green city service, Baolong business and xinchengyue service.
Risk tip: the policy will be tightened again, the sales and financing funds will be tightened again, and the restricted proportion will be increased again.
