RiseSun(SZ:002146) Zhong Zheng Wang·2025-08-30 00:15Core Viewpoint - Rongsheng Development demonstrates a clear trend of financial stabilization and multi-dimensional breakthroughs in its semi-annual report for the first half of 2025, showcasing a differentiated competitive advantage through strategic actions in a challenging industry cycle [1] Financial Performance - The net cash flow from operating activities significantly improved, with an increase of nearly 50% compared to the same period last year, driven by a cash flow-centric operational strategy [2] - Total assets as of June 30, 2025, amounted to 148.366 billion, a decrease of 8.28% year-on-year, but asset quality improved with inventory reduced from 110.727 billion to 99.443 billion, enhancing inventory turnover efficiency [2] - Despite the overall industry impact leading to less-than-ideal net profit attributable to shareholders, the decline is attributed to cyclical factors rather than a deterioration in operational losses, indicating potential recovery in profitability as project liquidation accelerates [2] Business Diversification - Non-real estate business has become a significant revenue supplement, with real estate accounting for 87.71% of total revenue, while non-real estate businesses generated 1.742 billion, increasing their share to 12.29%, up 3.59 percentage points from the previous year [3] - The Rongsheng Kanglv segment stands out as a leader in non-real estate business, focusing on cultural tourism and leveraging technology to enhance operational resilience and brand influence [3] - The company has established a substantial presence in various regions, operating 77 hotels and managing over 23,000 rooms, with plans for further expansion in 17 key cities [3] New Growth Opportunities - Rongsheng Development is strategically entering the low-altitude economy through its subsidiary, Meiya Airlines, capitalizing on supportive national policies and emerging market opportunities [4] - The "Sanya Sea and Air Station," a collaborative project with Hainan Xiaoshuai Intelligent Technology, has become a landmark for low-altitude tourism, integrating various functionalities for a comprehensive tourism experience [4] - The synergy between Meiya Airlines and Rongsheng Kanglv enhances the tourism product offering, creating a one-stop solution for aerial and ground vacation experiences [4] Valuation and Market Position - The current valuation of Rongsheng Development does not fully reflect its financial improvements and business diversification, with the price-to-book ratio at a low level compared to the industry [5] - The company has achieved a project delivery satisfaction rate of 99%, reinforcing brand trust and facilitating a positive cycle of sales and reinvestment [5] - Long-term growth potential from non-real estate businesses is expected to drive valuation increases, reducing reliance on the real estate sector and enhancing resilience and growth prospects [5]