LONGFOR GROUP(00960) 光大证券·2024-08-31 07:41Investment Rating - The report maintains a "Buy" rating for the company [3]. Core Insights - The company reported a revenue of 46.86 billion yuan for the first half of 2024, a year-on-year decrease of 24.5%, and a net profit attributable to shareholders of 5.87 billion yuan, down 27.2% year-on-year [2]. - The development business continues to face pressure, while diversified operations support performance; inventory reduction needs to accelerate, and the debt structure is improving [2]. - The company’s sales in the first half of 2024 were 51.1 billion yuan, a decline of 48.1%, with over 90% of sales coming from first- and second-tier cities [2]. - The company has a total land bank of 41.41 million square meters, down 8.8% from the end of 2023, indicating a depleting inventory cycle of approximately 5.7 years [2]. - The company opened three new shopping malls in the first half of 2024 and plans to open about ten more in the second half [2]. - The average loan term has been extended to 9.2 years, with a net debt ratio of 56.7% and a cash-to-short-debt ratio of 1.01 times, indicating a stable financial condition [2]. Summary by Sections Financial Performance - Revenue for 2024 is projected at 158.81 billion yuan, with a decline of 12.1% year-on-year; net profit is expected to be 10.93 billion yuan, down 14.9% [5]. - The company’s gross profit margin is 20.6%, a decrease of 1.8 percentage points year-on-year, primarily due to a drop in the gross margin of the development business [2]. Debt and Cash Flow - As of June 2024, total borrowings were 187.4 billion yuan, down 5.2 billion yuan from the end of 2023, with cash reserves of 50.1 billion yuan [2]. - The company maintains a healthy financial status with a debt-to-asset ratio of 58.6% after adjustments [2]. Market Outlook - The report anticipates continued pressure on sales and profit margins in the real estate market, leading to a downward revision of profit forecasts for 2024-2026 [2]. - The current stock price corresponds to a price-to-earnings ratio of 4.9X for 2024, indicating a valuation that reflects the company's diversified and stable development [2].