Core Viewpoint - New City Holdings has launched the "Wuyue Plaza Holding Real Estate Asset-Backed Special Plan," marking the first issuance of consumer-type holding real estate ABS in China and the first by a private A-share listed company, setting a dual record in the industry [1][2]. Group 1: Issuance Details - The issuance scale of the ABS is 616 million yuan, with a corresponding debt portion of 410 million yuan, and a product term of approximately 25 years [1][4]. - The underlying asset for this ABS is the Wuyue Plaza located in the core area of the Qingpu District, which serves over 400,000 residents from more than 160 surrounding communities [2]. Group 2: Market Impact and Significance - This issuance is expected to enhance New City Holdings' asset liquidity and optimize its capital structure, providing a new financing pathway for the commercial real estate sector [2][3]. - The ABS includes a continuous fundraising mechanism, allowing for the ongoing acquisition of quality assets, thus promoting sustainable development of the product [2]. Group 3: Financial Performance - As of Q3 2025, New City Holdings has established 205 comprehensive projects across 141 cities, with 176 operational and a high occupancy rate of 97.7% [2]. - The total foot traffic at Wuyue Plaza reached 950 million, with total sales exceeding 51.5 billion yuan, both showing a year-on-year increase of 16% [3]. Group 4: Broader Financing Strategy - The issuance is part of a broader direct financing plan approved in May 2025, allowing for up to 20 billion yuan in various financing instruments, including ABS and REITs [5][6]. - New City Holdings has engaged in multiple financing activities this year to bolster liquidity, including issuing bonds and restarting dollar bond issuance to manage upcoming debt obligations [6].

Core Viewpoint - The establishment of the "CITIC Construction Investment - Waigaoqiao Group Holding-type Real Estate Asset-backed Special Plan" marks a significant development in the asset-backed securities (ABS) market, particularly for state-owned enterprises in Shanghai, showcasing strong investor interest and a new model for revitalizing state-owned assets [1][2]. Group 1 - The project was initiated by Waigaoqiao Group as the original rights holder, with CITIC Construction Investment Securities acting as the plan manager and lead sales agency [1]. - The underlying assets consist of four industrial plant projects owned by Waigaoqiao Group, managed by its subsidiary, Shanghai Waigaoqiao Free Trade Zone New Development Co., Ltd [1]. - The issuance was conducted through a price inquiry method, with a range of 1.776 billion to 1.83 billion yuan, ultimately achieving a total issuance size of 1.83 billion yuan, attracting 21 investors from various sectors including insurance, bank wealth management, and local state-owned assets [1]. Group 2 - Waigaoqiao Group is recognized as the first developer and operator of the national bonded zone, bonded logistics park, and free trade zone, responsible for comprehensive development, investment attraction, industry cultivation, and property management services in the region [2]. - The selected underlying assets include four high-quality industrial plant projects located in the Waigaoqiao area, with a total building area of approximately 190,600 square meters and an average occupancy rate of 93.16% [2]. - The tenants include companies from industries such as IDC data centers, intelligent manufacturing, and biopharmaceutical research and development, aligning with regional industrial development strategies [2].

Investment Rating - The investment rating for the company is upgraded to "Buy" [9] Core Insights - The company's commercial operations have become the core of profitability, and a revaluation of its value is expected. The peak period for debt repayment has passed, and the safety of the cash flow is continuously improving. Market risk appetite is likely to gradually recover. The ample land reserves still provide certain guarantees for sales scale, while the high-profit self-owned business is steadily growing, contributing increasingly to profitability amid a declining development environment. Additionally, the self-owned business serves as a crucial source of cash flow and financing, effectively ensuring the company's financial safety. The potential for Real World Assets (RWA) opens up new possibilities, and high-quality self-owned assets may lay a solid foundation for future valuation recovery and breakthroughs [2][6][12]. Summary by Sections Financial Performance - In the first half of 2025, the company achieved revenue of 22.1 billion yuan (down 34.8%), with a net profit attributable to shareholders of 0.89 billion yuan (down 32.1%), and a non-recurring net profit of 0.95 billion yuan (down 28.2%) [6][12]. - The decline in settlement volume has dragged down revenue, while the contribution from high-profit self-owned business has increased, raising the gross profit margin. The company’s gross profit margin increased by 5.2 percentage points to 26.9% [12][13]. Sales and Construction - Sales performance remains under pressure, with a sales amount of 10.3 billion yuan (down 56.1%) and an area of 1.34 million square meters sold (down 59.1%) in the first half of 2025. The average price per square meter increased by 7.2% to 0.77 million yuan [12][13]. - The company has a land reserve of 29.09 million square meters available for sale or lease, which may support future sales despite a decrease in supply scale [12]. Self-Owned Business Growth - The self-owned business is experiencing steady growth, with a total commercial operating revenue of 6.94 billion yuan (up 11.8%) in the first half of 2025, achieving 49.6% of the annual target [12][13]. - The company has established 205 "Wuyue Plaza" locations across 141 cities, with an occupancy rate of 97.8% [12]. Future Outlook - The company expects a net profit attributable to shareholders of 0.81 billion yuan, 1.13 billion yuan, and 1.31 billion yuan for 2025, 2026, and 2027, respectively, corresponding to price-to-earnings ratios of 38.7, 27.8, and 23.9 times [12][13].

Core Viewpoint - New City Holdings is increasingly relying on its commercial operations as its residential development business continues to decline, with significant drops in revenue and net profit reported for the first half of 2025 [1][3]. Financial Performance - The company reported a revenue of 22.1 billion yuan, a decrease of 34.82% year-on-year, and a net profit of 0.895 billion yuan, down 32.11% from the previous year [1]. - Operating cash flow fell by 86.3% to 0.286 billion yuan, attributed to reduced contract sales in real estate projects [1]. Business Segments - The residential development segment saw a significant decline, with a turnover of 15.168 billion yuan, down 44.94%, and a gross profit margin of 20.3% [3]. - The commercial management segment's revenue increased by 10.66% to 6.423 billion yuan, contributing 77.06% to the company's total gross profit [5]. Sales and Contracts - Contract sales for the first half of 2025 amounted to 10.33 billion yuan, a decline of 56.15%, with a sales area of 1.335 million square meters, down 59.08% [3]. - The average selling price increased by 7.2% year-on-year, indicating a slight improvement in pricing despite lower sales volume [3]. Project Development - The company completed 36 projects with a total area of 2.7765 million square meters in the first half of 2025, while 158 projects are currently under construction [4]. - New City Holdings has a total unsold land area of 29.09 million square meters, with 41% located in first and second-tier cities [4]. Debt and Financing - As of June 30, 2025, the company had a total interest-bearing debt of 52.276 billion yuan, a decrease of 2.56% from the beginning of the year [5]. - The company has improved its financing channels, with significant contributions from its commercial properties, including a recent issuance of a 1 billion yuan medium-term note [7]. Asset Management - The company is actively pursuing various financing strategies, including public REITs and asset-backed securities, to enhance its cash flow and manage debt [7][8]. - The value of investment properties is approximately 121.5 billion yuan, with a significant portion being restricted due to collateral financing [7].