Key points
Demand side: Residents’ short-term loans and medium and long-term loans improved as scheduled, and the demand for reasonable house purchase is expected to receive further credit support. In March 2022, residents’ short-term loans increased by 384.8 billion yuan in a single month, a year-on-year decrease of 139.4 billion (- 26.6%), and an increase of 675.9 billion yuan month on month. In March 2022, the medium and long-term loans of residents increased by 373.5 billion yuan in a single month, a year-on-year decrease of 250.4 billion yuan (- 40.1%), and an increase of 419.4 billion yuan month on month; From January to March 2022, the cumulative increase of medium and long-term loans to residents was 1.07 trillion, with a year-on-year growth rate of – 46.0%. The proportion of medium and long-term loans to new residents accounted for about 12.8% (the annual level in 2021 was 30.5%).
On March 5, the national “two sessions” clearly proposed to “support the commercial housing market to better meet the reasonable purchase needs of buyers”; On March 16, the FSC proposed to “timely study and put forward effective risk prevention and resolution solutions for the real estate market”. On the same day, the central bank, the CBRC, the CSRC, the safe and the Ministry of finance also made statements respectively, focusing on preventing and resolving risks in the real estate market and promoting the virtuous circle and healthy development of the real estate industry. We believe that the reasonably improved demand for house purchase brought by the “multi child policy” and “home-based elderly care” is expected to be further supported, and the credit support for rigid house purchase is also expected to be improved.
Supply side: in March, domestic bond issuance increased significantly month on month, and overseas bond issuance recovered, with a positive year-on-year growth rate
In March, domestic and foreign real estate enterprises issued 86 billion yuan of bonds in a single month, with a month on month increase of + 159.0% (February – 29.2%), a year-on-year increase of – 13.2% (February – 25.8%), and a monthly net financing of – 14.5 billion yuan (February – 8.1 billion yuan). Among them, the domestic bond issuance in March was significantly higher than that in February, with a monthly issuance of 70.3 billion yuan, an increase of 133.3% month on month, a year-on-year decrease of 18.2% (February + 59.8%), and a monthly net financing of 16.1 billion yuan; In March, the year-on-year growth rate of overseas bond issuance became positive, and the market recovered. The issuance of bonds in a single month was 15.7 billion yuan, an increase of 411.2% month on month and 19.3% year-on-year (February – 88.1%), and the net financing amount in a single month was about – 30.7 billion yuan. In March 2022, the establishment amount of real estate collective trust was about 12.2 billion yuan, a year-on-year decrease of 81.5%, accounting for 14.9% of the establishment scale of collective trust in a single month, a decrease from February. Driven by the favorable policies of various parties, the domestic bond issuance scale of real estate enterprises rebounded significantly in March, and the market confidence was gradually restored. The overseas financing environment has warmed up. The Chinese dollar real estate bond index also ushered in a wave of rebound in mid March. The bond issuance scale of real estate enterprises has increased significantly, and they prefer to issue short-term bonds. The issuance interest rate of some real estate enterprises has increased compared with the previous period.
Investment suggestions: 1) since the beginning of 2022, many parties have released the capital area pole signal, the five-year LPR has been reduced by 5bp, the affordable housing loans have not been included in the concentration management, the new measures for the supervision of commercial housing pre-sale funds have been structurally corrected, and major banks have provided M & A financing support“ α The “risk” restoration has entered the implementation stage, and the liquidity of the real estate industry continues to ease. 2) While the liquidity is easing, China’s prudent management of real estate finance and the trend of “deleveraging” will continue to deepen, and some of the early overly radical real estate enterprises“ α “Risk” may still be exposed, but China’s real estate market“ β The overall trend of “coefficient” health and stability will not change. The high-quality real estate enterprises adhering to the principle of “moderate leverage, steady operation, quality and orderly development” will usher in the development opportunity of “orderly competition”, and gradually lead China’s real estate industry to the iterative upgrading of “rationalization of profits, refinement of management, high-quality products and green construction”. 3) On February 24, the Ministry of housing and urban rural development proposed to “meet the reasonable demand for improved house purchase”. On March 5, the government work report of the national two sessions made it clear that “support the commercial housing market to better meet the reasonable housing demand of house buyers”. We believe that the follow-up improvement of real estate credit support is expected to be improved, and the issuance of real estate bonds is expected to be large. On March 16, the meeting of the financial stability Committee of the State Council 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. We believe that the subsequent public offering of REITs in the real estate industry is expected to break the ice, and the first batch of most likely basic assets include affordable rental housing, commercial real estate, etc. 4) Recently, the market has paid more attention to the real estate sector and is optimistic about the long-term performance of high-quality leading real estate enterprises. Vanke A / Vanke enterprises, China Jinmao, Seazen Holdings Co.Ltd(601155) , Poly Developments And Holdings Group Co.Ltd(600048) , Gemdale Corporation(600383) , China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) , China overseas development, China Overseas Hongyang group, China Resources Land, Longhu group and Yuexiu real estate are recommended.
Risk analysis: covid-19 epidemic, economic restructuring and Sino US trade friction may lead to the development and employment of some industries in China falling short of expectations, which will affect residents’ income and credit expansion; The “three red lines” of real estate enterprises superimpose the centralized debt repayment period, and the risk of credit default of some real estate enterprises increases.
