Real estate sector: industry profit margin returns to normal, looking for deterministic opportunities
The growth rate of revenue and profit showed a downward trend, and the differentiation of enterprises was obvious. The operating revenue of the sample real estate enterprises in 2021 was + 12.5% year-on-year, and the net profit attributable to the parent was – 45.2% year-on-year. The profit of most real estate enterprises increased negatively, and the year-on-year growth rate continued to decline; The overall gross profit margin fell to 18.1%, close to the level of manufacturing industry, and will return to the normal level of manufacturing industry in the future; The cost control is more refined, and the proportion of sales management expenses in operating revenue shows a downward trend. The stability of state-owned enterprises and central enterprises is higher, the fluctuation range of revenue and profit is relatively small, the overall contract liabilities of private enterprises account for a high proportion of revenue, and the performance flexibility is large.
Sales investment declined as a whole, and high-quality real estate enterprises grew against the trend. In 2021, the sales amount of commercial housing in China increased by 4.8%, which was at a low level over the years. The average sales amount of typical real estate enterprises increased by 2.3%; Most real estate enterprises have low land acquisition enthusiasm, and the investment intensity of the whole year has decreased. The investment intensity of typical real estate enterprises is 0.35, 6 percentage points lower than that in 2020; Under the general trend of low sales and investment, high-quality real estate enterprises grew against the trend by virtue of investment layout, products and services.
Reducing the burden and reducing the table may become the mainstream, and the financing cost continues to decline. The growth rate of total assets and interest bearing liabilities of typical real estate enterprises continued to decline, and most real estate enterprises chose to reduce the burden and shrink the table; In 2021, the financing cost of typical real estate enterprises was 5.49%, a decrease of 21bp compared with 2020, showing a continuous downward trend.
Property sector: high growth, strong anti cyclical, property independence to be priced
High income and profit growth, highlighting the anti cyclical characteristics. The revenue of 50 listed property management companies increased by 46.5% year-on-year in 2021; The net profit attributable to the parent company increased by 45.6% year-on-year. Among all businesses, community value-added services developed the fastest, and the proportion of income and profit continued to increase. The change trend of employee cost may be used as an independent reference index of financial power. In 2021, the staff costs of some affiliated real estate enterprises of private property management companies decreased or increased only slightly, while the income and staff costs of property companies maintained a large increase, reflecting the financial independence of property companies.
The robustness of related real estate enterprises dominates the valuation of the property sector, and the valuation of property enterprises with strong independent operation ability is expected to be repaired in the future. We believe that the current situation of pricing the property sector entirely according to the soundness of related real estate enterprises is not entirely reasonable. The reason for this pricing is that the market has not really recognized the independence of private property enterprises, or it has not been accurately identified from the statement end. We believe that in the long term, high-quality material enterprises with independent operation ability have high profit quality, high certainty of future growth, and the valuation is expected to be repaired.
Investment suggestion: at present, the sales Investment in the real estate industry is relatively low, and the central government has actively set the tone for the industry regulation. It is expected that a wide range of multi-dimensional easing measures will continue to be introduced. We believe that the first and second tier cities with good fundamentals and the Yangtze River Delta will take the lead in stabilizing and warming up. In the real estate sector, we are optimistic about enterprises with contrarian growth of sales and investment, strong certainty of future performance and focus on high-quality cities. We recommend Greentown China, China Construction Development International and Hangzhou Binjiang Real Estate Group Co.Ltd(002244) . In the property sector, we are optimistic about private property management companies with high density and value-added services, and recommend Jinke service and country garden service.
Risk tip: loose regulation is less than expected; The epidemic affects the implementation of policies and market recovery; The recovery rate of real estate sales is lower than expected; The development of value-added services is not smooth
