Ge Long Hui·2025-08-31 10:55Core Viewpoint - Company reported 1H25 performance in line with market expectations, with revenue increasing by 25% year-on-year to 58.75 billion yuan, primarily due to an increase in development settlement scale, while core net profit attributable to shareholders decreased by 70.9% year-on-year to 1.38 billion yuan [1] Financial Performance - Company declared an interim dividend of 0.07 yuan per share, with a slight increase in payout ratio to 34.2% [1] - Interest-bearing liabilities decreased by 6.5 billion yuan to 169.8 billion yuan compared to the end of 2024, leading to a reduction in net debt ratio and pre-tax debt ratio by 0.5 percentage points and 1.2 percentage points to 51.2% and 56.1%, respectively [1] - Financing costs reduced to 3.58%, with the average loan term extended to 10.95 years [1] Operational and Service Business - Operating business revenue increased by 2.5% year-on-year to 7.01 billion yuan, with shopping center retail sales rising by 17% year-on-year to 40.2 billion yuan [2] - Service business revenue remained stable at 6.26 billion yuan, with property management covering approximately 400 million square meters [2] - Overall, operating and service businesses are expected to contribute approximately 4 billion yuan to core net profit in 1H25 [2] Development and Profitability Trends - Development settlement revenue increased by 35% year-on-year to 45.5 billion yuan, but gross margin was pressured to approximately 0.2% due to a higher proportion of older inventory in the settlement structure [2] - Company aims to further optimize debt structure and cash flow management, projecting a reduction of interest-bearing liabilities by about 20 billion yuan to around 145 billion yuan by the end of 2025 [2] Future Outlook - Company expects rental income growth to normalize starting in 2026, with the opening of 10 new shopping malls in the second half of the year [3] - Operating and service businesses are anticipated to continue serving as a stabilizing factor for cash flow and core net profit [3] Profit Forecast and Valuation - Core net profit forecasts for 2025 and 2026 have been revised down by 45% and 51% to 2.179 billion yuan (down 69% year-on-year) and 2.296 billion yuan (up 5% year-on-year), respectively [3] - Company maintains an outperform rating with a target price of 11.5 HKD, corresponding to 0.46 times the 2025 target P/B and a 9% upside potential [3]