SINOLINK SECURITIES·2024-03-28 16:00Investment Rating - The report maintains a "Buy" rating for the company, indicating an expected price increase of over 15% in the next 6-12 months [10]. Core Views - The company reported a total revenue of 465.74 billion RMB in 2023, a decrease of 7.6% year-on-year, and a net profit attributable to shareholders of 12.16 billion RMB, down 46.4% year-on-year [2][3]. - The decline in revenue and profit is attributed to reduced settlement volume and a drop in gross margin, with the gross margin for 2023 at 15.23%, down 4.32 percentage points from 2022 [2]. - The company remains the second-largest in the industry by contract sales, achieving a total of 376.1 billion RMB in 2023, a decrease of 9.8% year-on-year [2][3]. - The company has focused its investments on first- and second-tier cities, with 98% of the total land acquisition cost of 84.9 billion RMB in 2023 allocated to these areas [2]. Summary by Sections Financial Performance - In 2023, the company’s operating income was 465.74 billion RMB, with a year-on-year growth rate of -7.56% [7]. - The net profit attributable to shareholders was 12.16 billion RMB, reflecting a -46.23% change compared to the previous year [7]. - The diluted earnings per share for 2023 was 1.03 RMB, down 47.3% year-on-year [2][7]. Business Segments - The company’s operational service revenue reached 55.81 billion RMB in 2023, an increase of 8.9% year-on-year, with property management revenue growing by 10.2% to 33.42 billion RMB [3]. - The logistics and warehousing business generated 4.18 billion RMB, up 17.2%, while rental housing revenue increased by 6.8% to 3.46 billion RMB [3]. Debt Management - The company secured new domestic financing of 76.6 billion RMB and 13.1 billion RMB from overseas in 2023, with a domestic financing cost of 3.61% [3]. - The proportion of short-term interest-bearing liabilities decreased by 1.0 percentage points to 19.5% compared to 2022 [3]. Future Outlook - The forecast for net profit attributable to shareholders for 2024 and 2025 has been adjusted to 12.51 billion RMB and 12.75 billion RMB, respectively, with a new estimate for 2026 at 12.90 billion RMB [3][7]. - The company’s stock is currently valued at a PE ratio of 8.8 for 2024, indicating a stable outlook despite anticipated reductions in development activities [3].