Chengtou Holding(SH:600649) HTSC·2025-10-31 06:40Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of RMB 6.70 [1][5]. Core Insights - The company has experienced significant revenue growth driven by increased settlement volume, achieving Q3 revenue of RMB 3.588 billion, a year-on-year increase of 1264.26% [1]. - The company has turned profitable with a net profit of RMB 133 million in Q3, marking a year-on-year increase of 216.56% [1]. - The outlook for the company remains positive, with expectations of continued high revenue growth due to ample resources awaiting settlement and a strong sales pipeline [2][3]. Summary by Sections Revenue and Profitability - For the first three quarters of 2025, the company reported revenue of RMB 9.515 billion, a year-on-year increase of 938.80%, and a net profit of RMB 287 million, indicating a turnaround from losses [1][2]. - The gross margin is expected to recover to 17.1% in 2025, up 2.6 percentage points from 2024, as the settlement peak for key projects approaches [2]. Sales and Inventory - The company signed sales contracts worth approximately RMB 4.46 billion in the first three quarters, a decrease of 53% year-on-year due to the lack of new project launches [3]. - The unsold inventory is estimated to exceed RMB 70 billion, with 99% located in Shanghai, indicating a strong potential for future sales [3]. Operational Expansion - The rental business has expanded, with rental cash inflow reaching approximately RMB 107 million in Q3, reflecting a quarter-on-quarter increase of 7.2% [4]. - The company has initiated a C-REIT channel, planning to include community assets for further asset securitization, enhancing its operational capacity [4]. Financial Forecast and Valuation - The company forecasts net profits of RMB 569 million, RMB 826 million, and RMB 1.03 billion for 2025, 2026, and 2027, respectively [5]. - The target price is set at RMB 6.70, based on a price-to-book ratio of 0.76 times, reflecting the company's strong position in the Shanghai market and its proactive approach to city renewal [5].