Investment summary:
Market conditions:
This week (March 12-march 18), the A-share real estate index (Shenwan real estate) increased by 1.98% (last week - 5.48%), and the A-share market (wandequan a) increased by - 1.31% (last week - 3.96%); The H-share real estate index (kroney real estate leading index) rose 7.35% (last week - 9.04%), and the H-share market (Hang Seng Index) rose 4.18% (last week - 6.17%). This week, the performance of A-share and H-share real estate sectors were stronger than the market.
Industry fundamentals:
The market continued to be depressed and new home sales accelerated to decline. From the data, the cumulative sales area of commercial housing in 45 cities (3.1 ~ 3.17) was - 42.1% year-on-year and - 23.8% year-on-year last month; The transaction area of second-hand houses in 16 cities (3.1 ~ 3.17) was - 28.0% year-on-year and - 32.7% year-on-year last month.
The decontamination cycle continues to rise. From the data, the cycle of commercial housing in 15 cities (as of March 17) was 627 days, compared with 573 days in the same period last month. The land market is depressed. According to the data, the cumulative land construction area of 100 large and medium-sized cities this year (as of March 20) was - 46.6% year-on-year and - 44.7% year-on-year last week; The premium rate of land transaction in 100 large and medium-sized cities (3.14 ~ 3.20) this week was 2.5% and 1.6% last week; The total land transaction price of 100 large and medium-sized cities this year (as of March 20) was - 66.4% year-on-year, and - 65.7% year-on-year last week.
Financing remained sluggish. From the data, the issuance scale of domestic real estate bonds (3.1 ~ 3.19) has accumulated - 40.6% year-on-year, and the scale of last month was - 18.3% year-on-year; The issuance scale of overseas real estate bonds (3.1 ~ 3.19) was - 35.2% year-on-year, and the scale of last month was - 90.1% year-on-year; The scale of trust financing (3.1 ~ 3.19) accumulated - 83.1% year-on-year, and the scale of last month was - 51.2% year-on-year.
Investment strategy:
On March 16, the financial stability and Development Commission of the State Council held a special meeting to study the current economic situation and capital market problems. The meeting proposed that real estate enterprises should timely study and put forward effective risk prevention and resolution solutions, and put forward supporting measures for the transformation to a new development model. Subsequently, the six ministries and commissions of the Ministry of finance, the State Administration of foreign exchange, the China Securities Regulatory Commission, the China Banking and Insurance Regulatory Commission, the central bank and the China Securities Regulatory Commission spoke intensively to stabilize market expectations. The main contents were not to expand the pilot scope of real estate tax during the year, increase M & a loan support, and focus on supporting high-quality enterprise M & A.
Under the repeated epidemic situation, the sales pressure is further highlighted. Under the impact of shrinking demand and weakening expectation, both sides of supply and demand are facing great impact. The policy goal of "stabilizing land price, house price and expectation" will face great challenges. It is urgent to further strengthen the maintenance of market stability. The healthy and stable market is not only the need to prevent and resolve risks, but also the basis for the transformation of the industry to a new development model.
We believe that the central government's attitude towards real estate regulation has changed significantly. With the current clear policy tone and encouragement direction, the support of demand side policies is expected to be more accurate and intensive, and the support of financial institutions to both ends of supply and demand is expected to be further strengthened.
We believe that the advantages of financing will promote high credit real estate enterprises to gain advantages in the land and M & a market. The continuous land acquisition and promotion ability and high-quality credit endorsement are also expected to seize the opportunity when the demand recovers and further improve the market share. Recommend Vanke A, Poly Developments And Holdings Group Co.Ltd(600048) , Gemdale Corporation(600383) . The support from the financing side, after meeting the steady central enterprises and real estate enterprises in the head, will gradually overflow to the stable private enterprises, and the market will gradually restore confidence in the stable private enterprises. It is suggested to continue to track the leaders of the stable private real estate enterprises, such as Longhu group and country garden.
Risk tip: the risk that the implementation of industrial policies is less than expected, the risk that profitability continues to decline, and the risk that sales are less than expected.
