龙湖集团：受传统业务拖累-20250214

Investment Rating - The report maintains an "Outperform" rating for the company, with a target price revised down from HK$17.50 to HK$15.00 [5][9][12]. Core Insights - The company's core profit is expected to decline significantly from RMB 11.35 billion in 2023 to RMB 6.90 billion in 2024, primarily due to a decrease in sales and profit margins, alongside impairment losses [1][11]. - The report highlights that recurring income will support the company's performance in 2024, with a projected growth of 7.4% to RMB 26.7 billion, driven by rental and service income [1][9]. - The company is transitioning towards becoming a rental stock, with expectations that its profitability and financing will continue to be impacted by its real estate development business during 2025-2026 [2][9]. Financial Forecasts - Total revenue is projected to decline from RMB 180.74 billion in 2023 to RMB 120.24 billion in 2024, representing a year-on-year decrease of 33.5% [3][10]. - Gross contracted sales are expected to drop from RMB 173.49 billion in 2023 to RMB 101.12 billion in 2024, a decline of 41.7% [10]. - The gross profit margin is anticipated to decrease from 16.9% in 2023 to 15.1% in 2024, reflecting the impact of high land costs and falling property prices [1][10]. Debt and Financing - The company plans to use its land investment budget for deleveraging, aiming to repay approximately 10% of its total debt in 2024 [2][9]. - The report notes that the company has a significant amount of debt maturing in 2025, including RMB 10 billion in bonds and RMB 9.2 billion in syndicated loans [2][9]. Dividend Policy - The company is expected to maintain a dividend payout ratio of around 30%, despite the anticipated decline in core profits [1][2].