中金2025年展望 | 物业管理：寻找性价比机会

Industry Overview - The property management sector's stock price fluctuations in 2024 remain significantly influenced by the real estate beta, with most major stocks continuing to move in tandem with their associated real estate developers [1] - The sector's growth in 2024-25 is expected to be driven by the expansion of basic property management services, with revenue and profit growth primarily coming from new contract conversions [2] - The sector's valuation has stabilized, with the forward P/E ratio for core covered companies bottoming out in 2024, supported by steady growth expectations and increased dividend payouts [5] Market Performance - The Hang Seng Property Services and Management Index fell 6% year-to-date, underperforming the Hang Seng China Enterprises Index by 27 percentage points, while the Tonghuashun Real Estate Index rose 34% [5] - The property management sector experienced four rounds of market risk preference improvement driven by positive real estate policies from November 2022 to October 2024, with the volatility of property management stocks narrowing compared to real estate stocks [6] - During the 2024 September-October period, state-owned property management companies saw an average rebound of 69%, while private property management companies saw an average rebound of 55% [8] Growth Drivers - The core growth driver for the sector remains the expansion of basic property management services, with the contribution from value-added services slowing down due to the real estate downturn [10] - The real estate exposure of property management companies has been declining, with non-owner value-added services accounting for 13% of revenue for state-owned and some private companies in 1H24, down from 17% in 2022 [11] - The overall real estate-related revenue exposure for private property management companies is expected to be below 10%, with further declines anticipated in the next two years [12] Financial Health - The sector's collection rate and accounts receivable are expected to remain under pressure in 2024, with core covered companies relying on collection management measures and balance sheet items to support operating cash flow [2] - The comprehensive collection rate for core covered companies fell by 3.7 percentage points year-on-year in 1H24, with the trend expected to continue for the full year [13] - Despite the pressure on collection rates, the sector's operating cash flow remains healthy, with a coverage ratio of 1.7 times core net profit in 2023 [13] Investment Strategy - The sector is currently trading at 11.5x 2024 and 10.0x 2025 market-cap weighted P/E ratios, with an expected dividend yield of 5.5% for 2024 [3] - Two investment strategies are recommended: 1) opportunistic left-side positioning in high-quality stocks during real estate beta-driven price fluctuations, and 2) seeking alpha opportunities from operational improvements [3] - The sector's stock price volatility is expected to be narrower than that of real estate stocks, with attractive dividend yield opportunities during pullbacks [14] Business Model and Policy Environment - The property management sector's business model is more stable than real estate, with steady profit growth expectations and an upward trend in dividend payouts [14] - The policy framework for the sector remains relatively stable, with recent updates to regulations in some provinces and cities [10] - Property service fees are considered essential consumption, providing some resilience to the sector's operating cash flow despite economic pressures [13]