GRANDJOY(SZ:000031) KAIYUAN SECURITIES·2025-03-17 08:04Investment Rating - The report assigns a "Buy" rating for the company, marking its first coverage [5]. Core Views - The company is driven by a "development + operation" dual strategy, focusing on core cities across China, with a notable improvement in profitability and a positive outlook for net profit from 2024 to 2026 [5][6]. - The company has a stable debt structure and is continuously optimizing its financing costs, with a significant reduction in the average borrowing cost [8][9]. Summary by Sections 1. Development and Operation Strategy - The company, backed by COFCO Group, has established a robust brand ecosystem through its dual-driven model, focusing on both development and operation [5][24]. - The strategic path is clear, with a broad business layout across 38 cities, emphasizing residential, commercial, and industrial real estate [29][31]. 2. Operational Capabilities - The investment property segment has shown strong growth, with revenue from investment properties reaching 5.393 billion yuan in 2023, a year-on-year increase of 24.3% [7][42]. - The company has a total of 45 commercial projects nationwide, with 34 operational projects covering a total commercial area of 3.74 million square meters [37][38]. 3. Development Business - The company achieved a total contract signing of 46.1 billion yuan in 2023, despite a 19% year-on-year decline, ranking 29th in the sales performance of real estate companies in China [6][77]. - The company maintains a cautious approach to land acquisition, focusing on core urban areas, with a significant reduction in land acquisition area and amount in 2023 [6][9]. 4. Financial Performance and Forecast - The company expects net profits to improve from -3.035 billion yuan in 2024 to 872 million yuan in 2026, with corresponding EPS moving from -0.71 yuan to 0.20 yuan [5][9]. - The overall revenue for 2023 was 36.783 billion yuan, with a projected slight increase in 2024 [9][31]. 5. Debt Structure and Financing - The company has a stable debt structure with a total interest-bearing debt of 72.648 billion yuan and a debt-to-asset ratio of 76.73% as of the end of 2023 [8][9]. - The average cost of new borrowings in the first half of 2024 was 3.13%, indicating a downward trend in financing costs [8][9].