Core Viewpoint - The company reported its 1H25 performance, which met expectations with a revenue of 8.52 billion yuan, a year-on-year increase of 6.5%, and a core net profit of 2.01 billion yuan, up 15.0% year-on-year [1] Group 1: Financial Performance - The reported net profit attributable to shareholders increased by 7.4% year-on-year to 2.03 billion yuan, affected by a high base from fair value changes in the previous year [1] - The company declared an ordinary dividend of 0.529 yuan per share and a special dividend of 0.352 yuan per share, corresponding to a payout ratio of 60% and 40% based on core net profit [1] Group 2: Shopping Center Performance - The retail sales of managed shopping centers grew by 21.1% year-on-year in 1H25, with same-store sales growth of 9.7%, significantly outperforming the overall retail sales growth [1] - The luxury shopping center segment achieved a same-store sales growth of 9.6%, demonstrating resilience [1] - The shopping center segment's revenue increased by 20% year-on-year, with an improvement in operational efficiency, as gross margin rose by 6.2 percentage points to 78.7% [1] Group 3: Office and Community Space Performance - In a challenging industry environment, the office and community space segments maintained stable or slightly increased revenues, with office occupancy rates rising by 0.5 percentage points [2] - The community space business saw a slight increase in gross margin by 0.2 percentage points and a year-on-year collection rate improvement of approximately 0.6 percentage points [2] - The urban space segment achieved a revenue growth of 15% year-on-year, with gross profit increasing by 8% [2] Group 4: Growth Outlook - The company aims to maintain its annual growth guidance and cash flow targets, with over 40% of its 125 operational projects ranking first in local market retail sales [2] - The company has a robust project pipeline, with 75 projects not yet opened as of 1H25, and plans to open 14 new projects in 2025, providing ongoing growth momentum [2] - The company targets a double-digit core net profit growth for the full year, supported by strong cash flow [2] Group 5: Profit Forecast and Valuation - The profit forecast remains largely unchanged, with expected core net profit growth of 15% and 11% for 2025 and 2026, reaching 4.04 billion yuan and 4.50 billion yuan respectively [3] - The company maintains an outperform rating and a target price of 40 HKD, corresponding to a 21 times core P/E ratio for 2025, implying a 6% upside potential [3] - The company is trading at a 20 times core P/E ratio for 2025, with an expected dividend yield of 5.1% based on a 100% core net profit payout [3]

Core Insights - The article emphasizes the importance of property services in connecting people's livelihoods and development, addressing the urgent needs of the community in Huai'an City [1] Regulatory Enhancements - The Huai'an Housing and Urban-Rural Development Bureau has introduced over 10 regulatory documents, including the "Huai'an City Preliminary Property Service Bidding Management Measures," to standardize industry management [1] - A leadership accountability mechanism has been established to oversee and address prominent issues in property management [1] Community Service Improvements - The city has adopted a dual approach of "renovation + governance" to enhance urban management, benefiting 13,800 households through the renovation of 68 old residential communities [1] - The implementation of "two new" policies has addressed the challenges of aging elevators, reducing emergency repair approval times to one working day and accelerating elevator replacement projects by 30 days [1] Safety Assurance Initiatives - Huai'an has taken the lead in the province by promoting legislation for electric bicycle charging safety management, implementing the "Huai'an City Residential Community Electric Bicycle Charging Safety Management Regulations" [1] - The city has constructed over 4,300 new parking shelters and added more than 128,000 charging ports, bringing the total number of charging ports in residential communities to over 320,000, with a provision ratio of 1:2.6, ranking among the top in the province [1] - Efforts are underway to rectify high-rise buildings with "no water" safety hazards in 184 communities [1] Long-term Management Strategies - The industry has standardized entry requirements and promoted homeowner autonomy, fully implementing a collaborative mechanism for property management in residential communities [1] - A pilot program for public revenue supervision has been expanded to 95 communities, with audits standardizing revenues of over 4.9 million yuan [1]