BOCOM International·2025-07-11 10:51Investment Rating - The report assigns a "Buy" rating to several companies in the real estate sector, including Sun Hung Kai Properties, China Resources Land, Link REIT, Country Garden Services, and Yuexiu Property, among others [3][4]. Core Insights - The overall real estate market remained stable during the peak season in June 2025, with total sales rising from RMB 316.2 billion in May to RMB 370.8 billion, reflecting a month-on-month increase of 17.2% [4][10]. - The report highlights that state-owned enterprises (SOEs) dominated the sales performance, with a market share of 74.8% among the top 50 developers in the first half of 2025 [4][11]. - The report anticipates continued improvement in secondary market demand, with a preference for projects by state-owned enterprises as buyer sentiment improves [4][12]. Market Performance - The stock prices of mainland Chinese developers have generally outperformed the broader Chinese corporate index over the past month, with the industry net asset value discount narrowing to 87.3% [5]. - In June, the sales of the top 100 developers increased by 12.3% month-on-month, driven by a rise in average sales prices and sales area [10][11]. Sales Performance - The report indicates that the total contract sales for the first half of 2025 decreased by 11.4% year-on-year to RMB 177.92 billion, compared to RMB 200.82 billion in the same period of 2024 [10][11]. - Among the top developers, Poly Developments ranked first in sales, with a total of RMB 29.1 billion in June, despite a year-on-year decline of 31% [13][14]. Policy Review - The central government has initiated policies aimed at promoting high-quality development in the real estate sector, focusing on optimizing existing policies and encouraging local governments to implement tailored measures [33][35]. - Over 26 cities have introduced market stabilization policies in June 2025, addressing various aspects such as housing subsidies and urban renewal [35][36]. Company Updates - China Resources Land plans to issue a new tranche of medium-term notes worth RMB 3 billion, while also securing a RMB 5.85 billion offshore loan [41]. - Sunac China has received support from 75% of its creditors for its offshore debt restructuring, indicating a positive outlook for the company's financial recovery [43].