Investment summary:
Market conditions:
This week (April 16-april 22), the A-share real estate index (Shenwan real estate) increased by – 9.20% (last week – 2.90%), and the A-share market (wandequan a) increased by – 4.76% (last week – 2.46%); The H-share real estate index (kroney real estate leading index) rose – 9.43% (last week – 1.81), and the H-share market (Hang Seng Index) rose – 4.09% (last week – 1.62%). This week, the performance of A-share and H-share real estate sectors were weaker than the market.
Industry fundamentals:
The epidemic continues to impact sales. From the data, the cumulative sales area of commercial housing in 45 cities (4.1 ~ 4.22) was – 51.7% year-on-year and – 41.7% year-on-year last month; The transaction area of second-hand houses in 16 cities (4.1 ~ 4.24) was – 33.8% year-on-year and – 30.3% year-on-year last month.
The decontamination cycle continues to rise. According to the data, the de commercialization cycle of commercial housing in 15 cities (as of April 24) was 798 days, compared with 646 days in the same period last month. The land market is weak in supply and demand. According to the data, the cumulative land construction area of 100 large and medium-sized cities this year (as of April 24) was – 39.0% year-on-year, and – 37.2% year-on-year last week; The premium rate of land transaction in 100 large and medium-sized cities (4.11 ~ 4.24) this week was 3.9% and 1.4% last week; The total land transaction price of 100 large and medium-sized cities this year (as of April 24) was – 55.1% year-on-year, and – 54.7% year-on-year last week.
Great financing pressure. From the data, the issuance scale of domestic real estate bonds (4.1 ~ 4.24) has accumulated – 65.0% year-on-year, and the scale of last month was – 41.4% year-on-year; The issuance scale of overseas real estate bonds (4.1 ~ 4.24) was – 5.8% year-on-year, and the scale of last month was 9.4% year-on-year; The scale of trust financing (4.1 ~ 4.24) accumulated – 77.3% year-on-year, and the scale of last month was – 84.7% year-on-year.
Investment strategy:
The central bank has a clear attitude, continued to strengthen monetary policy support, relaxed regulation and moved towards high-energy cities. On April 18, the central bank and safe issued a circular, proposing 23 policy measures and proposing “implementing policies in line with the city, reasonably determining the minimum down payment ratio and minimum loan interest rate requirements for commercial individual housing loans, supporting the reasonable financing needs of real estate development enterprises and construction enterprises, and promoting the steady and healthy development of the real estate market. We will increase support for high-quality projects, not blindly withdraw loans, cut off loans and suppress loans, and not engage in” one size fits all “, Keep the steady and orderly release of real estate development loans. Commercial banks and financial asset management companies should do a good job in M & a financial services for risk disposal projects of key real estate enterprises. ” Since March, the financial support for both ends of real estate supply and demand has been continuously strengthened, and the regulatory policies have been relaxed, gradually moving from low-energy cities to high-energy cities.
Under the impact of shrinking demand and weakening expectation, both sides of supply and demand are facing great impact. It is expected that the measures to rescue real estate enterprises and improve demand will be more proactive. It is urgent to further strengthen market support, and the policy tone has gradually shifted from correcting deviations at the end of last year to support. With the current clear policy tone and encouragement direction, the initiative of financial institutions to support the rescue of real estate enterprises and the integration of Project M & A will be further strengthened. Local governments will also be more targeted in improving demand. Although the recent multi-point outbreak of the epidemic has affected the implementation and effectiveness of the policy and hit market confidence. However, the government’s determination to boost the market has been relatively clear. With the increasingly clear rescue path of real estate enterprises and the gradual appearance of the effect of stability maintenance policies at both ends of supply and demand, the stabilization and recovery of industrial sales will be gradually approaching.
We suggest to configure high-quality real estate enterprises with high credit. Many low credit private enterprises with high risk still face great liquidity pressure, which may be difficult to support until the market warms up; Moreover, frequent negative news and almost lost land acquisition ability have also greatly damaged the market reputation and future development space of the enterprise. The high-quality real estate enterprises with high credit can win the trust of buyers at the sales end under the industry background of frequent thunderstorms; On the supply side, it can continuously obtain the financing support of financial institutions, and still has the ability to obtain land in the open market and acquire projects through M & A under the current market environment; In the process of the government promoting the rescue of private real estate enterprises, the central enterprises and state-owned real estate enterprises with high credit and the private leaders with steady operation also have the opportunity to undertake the core assets of the insured real estate enterprises and further integrate high-quality resources in the process of industry liquidation. Market reputation and operating strength have laid the cornerstone for the future development of high credit real estate enterprises. It is 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) , and continue to track the leaders of private real estate enterprises with stable operation, 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.
