CHINA OVERSEAS(HK:00688) Ping An Securities·2025-03-31 14:12Investment Rating - The report maintains a "Buy" recommendation for China Overseas Development (0688.HK) with a current stock price of HKD 13.9 [1]. Core Insights - The company has shown resilience in sales, ranking second in overall sales and first in equity sales within the industry, with a market share increase [5]. - The company focuses on key cities, with 85% of sales coming from first-tier and key second-tier cities, achieving significant sales records in high-end residential projects [5]. - The financial health of the company is strong, with a low average financing cost of 3.1% and a cash reserve of HKD 124.17 billion, which supports its market opportunities [5]. Financial Performance Summary - In 2024, the company reported revenue of HKD 185.15 billion, a decline of 8.6% year-on-year, and a net profit of HKD 15.64 billion, down 38.9% year-on-year, with a proposed final dividend of HKD 0.30 per share [3][5]. - The projected revenue for 2025 is HKD 194.41 billion, with a growth forecast of 5.0%, and net profit is expected to rise to HKD 16.01 billion, reflecting a 2.4% increase [4][10]. - The gross margin is projected to stabilize around 18% for the next few years, while the net margin is expected to be around 9% [10]. Sales and Market Position - The company achieved a record sales figure of HKD 387 billion for a single project, with an average selling price increase of 24.4% to HKD 33,810 per square meter [5]. - The company acquired 22 land parcels in 2024, with a total investment of HKD 80.6 billion, leading the industry in land acquisition [5]. Future Projections - The report projects a gradual recovery in sales and profitability, with EPS estimates adjusted to HKD 1.46 for 2025 and HKD 1.49 for 2026, reflecting a cautious outlook amid ongoing industry adjustments [5][10].