Investment Rating - The report maintains a BUY rating for Greentown Service with a target price (TP) revised up by 3% to HK$ 6.13, reflecting a better outlook than peers, representing a 25x 2024E P/E [2][4]. Core Views - Greentown Service's revenue and core operating profit increased by 11% and 26% YoY in 1H24, respectively, driven by stable parent company support, robust third-party expansion, and a diversified value-added services (VAS) business [2][3]. - The company anticipates core operating profit growth exceeding 20% and cash growth over 15% for 2024E, indicating strong operational performance despite industry challenges [2][3]. - The net increase in managed gross floor area (GFA) from Greentown Real Estate surged 227% YoY, contrasting with a -42% decline from third parties, enhancing the company's competitive position [2][8]. Financial Performance Summary - In 1H24, Greentown Service achieved a revenue of RMB 9,068 million, a 10.6% increase YoY, and a core operating profit of RMB 893 million, reflecting a 25.8% growth YoY [7][9]. - The gross profit margin improved to 19.2%, up 0.6 percentage points YoY, while the core operating margin expanded to 9.8%, an increase of 1.2 percentage points YoY [7][9]. - The company expects a cash balance of RMB 4.3 billion by the end of 2024, anticipating a 15% YoY increase in cash on hand [2][3]. Growth Projections - Revenue is projected to grow from RMB 17,393 million in FY23A to RMB 19,364 million in FY24E, representing an 11.3% growth rate [3][11]. - Net profit is expected to rise from RMB 605.4 million in FY23A to RMB 724.6 million in FY24E, indicating a 19.7% growth [3][11]. - The company has lifted its full-year core operating profit growth guidance from over 15% to over 20% for FY24E [2][3]. Valuation Metrics - The report highlights a P/E ratio of 13.3x for FY24E, which is competitive compared to peers in the property management sector [3][15]. - The dividend yield is projected to increase from 4.5% in FY23A to 5.3% in FY24E, reflecting a commitment to returning value to shareholders [3][15].
绿城服务：Solid 1H24 against industry headwinds