Industry core view:
Under the macro background of "steady growth", the fundamentals of the real estate industry continue to stay at the bottom, and the marginal improvement policy continues. It is expected that there are still many favorable policies to be expected in the follow-up, and continue to be optimistic about the market performance of the real estate sector. It is suggested to pay attention to (1) property management companies with good fundamental performance; (2) High quality real estate enterprises with financial stability and background of central enterprises / state-owned enterprises; (3) Real estate enterprises with high-quality holding properties or transformation enterprises, or effectively form a virtuous capital cycle of "development +".
Key investment points:
Market review last week: last week, the real estate index of shenwanyi industry fell 2.9%, the Shanghai and Shenzhen 300 index fell 0.99%, and the performance of the real estate sector was weaker than the market. Since 2022, the real estate industry has increased by 9.32%, and the CSI 300 index has decreased by 15.21%, with significant relative gains.
Key policy highlights: (1) the people's Bank of China decided to reduce the deposit reserve ratio of financial institutions by 0.25 percentage points on April 25, 2022; (2) The people's Bank of China held a press conference on financial statistics for the first quarter of 2022. Banks in more than 100 cities across the country have independently lowered mortgage interest rates according to market changes and their own business conditions, with an average range of 20 to 60 basis points; (3) The CSRC, SASAC and the all China Federation of industry and Commerce jointly issued a document to adhere to the principle of "no speculation in housing", support listed real estate enterprises to actively transform to a new development model according to law and regulations, strengthen their own risk management, pay close attention to the market situation and Industry changes, strictly prevent and properly resolve various risks, and promote the virtuous circle and healthy development of the real estate industry; (4) Suzhou, Nanjing, Yichang, Hubei and other places liberalized sales restrictions; (5) Ziyang, Sichuan, Nanping, Fujian and Yichang, Hubei reduced the proportion of down payment; (6) Anhui Huaibei, Nanning, Zhengzhou and other places have introduced house purchase subsidy policies; (7) More underground mortgage interest rates.
Industry fundamentals: sales decline, and the performance of the land market is still weak. From April 4 to April 10, the sales of commercial houses in 30 large and medium-sized cities fell by 50.58% year-on-year, including 49.01% in the first line, 48.02% in the second line and 56.17% in the third line; The supply and construction of residential land in Baicheng fell by 64.2% year-on-year and 55.14% year-on-year since the beginning of the year; The transaction and construction area of residential land in Baicheng decreased by 47% year-on-year and 62.31% year-on-year since the beginning of the year; The premium rate of residential land in Baicheng was 0.2%, down 3.6 percentage points month on month. Last week, Changsha completed the first batch of centralized land supply in 2022, the flow auction rate decreased, the premium rate increased, and the local auction market warmed up.
Trends of key companies: several companies announced their performance in 2021 and Grandjoy Holdings Group Co.Ltd(000031) turned losses into profits Shanghai Lujiazui Finance & Trade Zone Development Co.Ltd(600663) holding subsidiary has four pieces of land polluted, involving an area of 118000 square meters. Last week, the scale of bond issuance continued to decline compared with the same period last year; Shenzhen talent housing group project has recently been submitted to the national development and Reform Commission, becoming the first officially declared affordable rental housing REITs project in China.
Risk factors: the strength of policies is less than expected, the industry fundamentals continue to decline rapidly, and the credit risk is higher than expected
