Core view
Market review this week. In the 13th week, the real estate sector index was stronger than the CSI 300 index and the gem index. The relative return of the real estate sector compared with the CSI 300 index was + 8.4%. The CSI 300 index closed at 427616, with a weekly increase of + 2.4%; The gem index closed at 266697, with a weekly increase of + 1.1%; The real estate sector index closed at 373458, with a weekly increase of + 10.8%.
Industry highlights this week. Central bank: more than half of residents expect house prices to remain basically unchanged in the next quarter. National Development and Reform Commission: promote more qualified stock projects to issue infrastructure REITs. The Hong Kong Stock Exchange set the cash settlement price of Evergrande shares at HK $1.65. In 2022, Shenzhen listed the first batch of 8 land parcels for land supply. The first batch of 13 parcels of land in Chongqing were all sold. The first batch of land supply transactions in Chengdu included 44 land parcels and 6 land parcels. Wanda joins hands with Jianye, and Wanda will be responsible for the operation of commercial projects of Jianye real estate.
Sales of new houses this week increased compared with last week, and sales of second-hand houses increased compared with last week. In the 13th week, the sales of new houses in 29 major cities was 28000 units, an increase of 27.2% over the 12th week; The sales of second-hand houses in 11 major cities were 8000 units, an increase of 15.1% over the 12th week; Compared with the 12th week, the growth rates of new housing and second-hand housing transactions in first tier cities were – 43.9% and – 20.7% respectively; Compared with the 12th week, the growth rates of new housing and second-hand housing transactions in second tier cities were + 53.4% and + 83.7% respectively. Inventory decreased compared with last week, and inventory sales increased compared with last week. In the 13th week, the inventory of 15 major cities was 1222000 sets, a decrease of 5000 sets compared with the 12th week; The stock to sales ratio was 17.1 months, an increase of 0.5 months over the 12th week. The number of land market transfers increased compared with last week. In week 13, a total of 45 pieces of land were sold in 26 major cities. The amount of land transfer increased. In the 13th week, the land transfer fee of 26 major cities was 40.07 billion yuan, an increase of 17.47 billion yuan compared with the 11th week. The average premium rate decreased. In the 13th week, the average premium rate of land transactions in 26 major cities was 3.0%, 6.2% lower than that in the 11th week.
Announcement of key companies China Vanke Co.Ltd(000002) , Shanghai Lujiazui Finance & Trade Zone Development Co.Ltd(600663) , Cinda Real Estate Co.Ltd(600657) , Citychamp Dartong Co.Ltd(600067) , etc. publish the annual report of 2021 Yango Group Co.Ltd(000671) early termination of the third phase of ESOP Shanghai Jinqiao Export Processing Zone Development Co.Ltd(600639) completed cashing 600 million yuan of ultra short-term financing bonds Shenzhen Tagen Group Co.Ltd(000090) bid for the plot Greattown Holdings Ltd(600094) repurchased 54.475 million ordinary shares, accounting for 2.2% of the total share capital of the company, with a repurchase fund of 200 million yuan Grandjoy Holdings Group Co.Ltd(000031) there is a personnel change of directors, supervisors and senior management.
Investment proposal and investment object
Under the epidemic, the new and second-hand housing market rebounded this week, and the local auction in some cities recovered to a certain extent, indicating that the operation of high credit real estate enterprises may be improved, but the bottom building trend of fundamentals has not been reversed. The market rose this week under the expectation of loose policy. We believe that the policy will eventually show an average force at both ends: the supply side will promote the problem real estate enterprises to sell projects at a significant discount, and the state-owned enterprises and high-quality private enterprises will take over the projects; On the demand side, some cities with little upward pressure on house prices can be further deregulated. The final result is that the owner’s equity of the problem real estate enterprises has been lost, the creditors have suffered a certain degree of loss on average, and the resident Department has slowly increased a certain degree of leverage. In this framework, looking for marginal real estate enterprises is not a good strategy. Most marginal real estate enterprises will lose capital on a large scale and completely lose the ability to increase leverage in the future. Based on the expectation of loose policy, we suggest the balanced allocation of the first-line leaders and some high rated flexible targets, favor the first-line leaders with stable performance, and recommend Poly Real Estate ( Poly Developments And Holdings Group Co.Ltd(600048) , buy), China Vanke Co.Ltd(000002) ( China Vanke Co.Ltd(000002) , buy); Second tier leaders with flexible performance are recommended Gemdale Corporation(600383) ( Gemdale Corporation(600383) , buy) and Longhu group (00960, buy). At the same time, we are optimistic about the property management and business management industry with rapid growth and less credit damage. We recommend Country Garden Service (06098, buy), poly property (06049, buy), China Merchants Property Operation & Service Co.Ltd(001914) ( China Merchants Property Operation & Service Co.Ltd(001914) , overweight), New Dazheng Property Group Co.Ltd(002968) ( New Dazheng Property Group Co.Ltd(002968) , buy), rongchuang service (01516, buy), 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.
