\u3000\u3 China Vanke Co.Ltd(000002) 244 Hangzhou Binjiang Real Estate Group Co.Ltd(002244) )
Key investment points
Financial stability, financing advantages continue to consolidate
In 2021, the growth rate of the company's revenue and net profit attributable to the parent company exceeded 30%. As of 2022q1, the company's sold and unsettled advance payment for houses was 97 billion yuan, covering more than 2.5 times the revenue in 2021, providing a relatively stable safety cushion for the growth of subsequent revenue. The debt structure of the company is reasonable and controllable. It is an excellent student of "green file" with three red lines. In 2021, the comprehensive financing cost will be further reduced to 4.9%, which is at a lower level compared with the industry. As of March 2022, the coupon rate of short-term financing, medium-term financing and other financing instruments issued by the company is mostly lower than 4%, and the financing cost of the company is expected to further decline.
Maintain the intensity of land acquisition, focus on advantageous areas, and increase investment against the trend
At the end of 2021, the total land storage area of the company accounted for 55% in Hangzhou and 92% in Zhejiang. The company continued to consolidate its regional competitive advantage. The company entered Guangdong, Hong Kong and Macao Dawan district for the first time in 21 years and continued to layout high-energy cities. As of April 2022, the company's land acquisition efforts have increased instead of decreasing, and the land acquisition amount / sales amount has reached 66%. Among the first batch of centralized land supply in Hangzhou, 11 plots have been obtained with a total price of 18.4 billion. The company still maintains a high land acquisition intensity during the period of great downward pressure on the industry, which not only provides a solid guarantee for the follow-up sales, seizing the land acquisition window and actively supplementing high-quality soil storage, but also helps to improve the company's medium and long-term gross profit margin.
Strong product superposition brand strength, brand breakthrough, premium and high de industrialization
In 2021, the company achieved a contract sales amount of 169.1 billion yuan, an increase of 24% year-on-year, and the annual sales target completion rate reached 112.8%. It became one of the few real estate enterprises to achieve the annual target. Kerry's full caliber sales amount ranking successfully ranked among the top 30. The company establishes a high standard product system through continuous iteration of products, while deepening project management, strictly controlling project quality, continuously improving service capacity and consolidating its own brand strength. In the base city of Hangzhou, the projects developed by the company can achieve higher premium and faster de commercialization than competitive products. According to the sales amount ranking data of Hangzhou over the years according to Kerry statistics, the company surpasses a number of national real estate enterprises and ranks first in the list all year round. It can better reflect the company's strong brand influence in terms of project flow rate and average sales price.
Investment suggestion: give "buy" rating for the first time
We believe that the company is financially sound. In 2022, the company will maintain a high land acquisition intensity and continue to cultivate the advantageous regions Hangzhou and Zhejiang Province. It is expected to take the lead in benefiting from the improvement of demand margin brought by policy relaxation. The brand strength of the company is relatively prominent, and the sales growth is highly deterministic. We estimate that the net profit attributable to the parent company from 2022 to 2024 will be RMB 3.5 billion, RMB 3.9 billion and RMB 4.2 billion respectively, and the EPS in 2022 will be RMB 1.12 per share. Referring to the valuation of comparable companies, we give the company 9 times PE valuation in 2022, corresponding to the target price of 10.11 yuan.
Risk tip: the strength and effect of policy relaxation are not as expected; The epidemic situation has repeatedly delayed the repair time.
