Investment Rating - The report maintains a "Positive" rating for the property management industry [3][4][5] Core Viewpoints - The property management sector is experiencing a slowdown in growth, with a divergence in performance among companies. The overall revenue growth for the sector in H1 2025 is +4.8% year-on-year, a decrease of 2.3 percentage points compared to the previous year [3][12] - First-tier property management companies show a revenue increase of +7.1%, while second-tier companies only see a +0.6% increase, indicating a trend where stronger companies continue to outperform [3][12] - The report highlights that the property management industry possesses unique characteristics such as significant growth potential, a walled property attribute, and a legacy of concentration, which are expected to drive future development [4][6] Summary by Sections Section 1: Revenue and Performance - In H1 2025, the overall revenue of the property management sector increased by +4.8% year-on-year, with first-tier companies at +7.1% and second-tier at +0.6% [3][12] - The net profit for the sector grew by +1.1% year-on-year, with first-tier companies experiencing a decline of -1.2% and second-tier companies seeing an increase of +7.7% [3][16][17] Section 2: Profitability Metrics - The overall gross margin for the property management sector is 19.3%, down by 1.0 percentage points year-on-year, with first-tier companies at 18.7% and second-tier at 20.5% [3][19] - The net profit margin for the sector is 7.1%, a slight decrease of 0.3 percentage points year-on-year, with first-tier companies at 7.8% and second-tier at 5.6% [3][36] Section 3: Service Revenue Composition - In H1 2025, the revenue composition for property management services is 75% from basic services, 9% from non-owner value-added services, and 9% from owner value-added services, with respective year-on-year growth rates of +8%, -6%, and -9% [3][58] - The average managed area for 13 major property management companies increased by +5% year-on-year, while the contracted area saw a slight decline of -0.3% [3][71] Section 4: Financial Ratios - The overall asset-liability ratio for the property management sector is 43.7%, down by 3.7 percentage points year-on-year, while the return on equity (ROE) is 4.6%, a decrease of 0.5 percentage points [3][4] - The average accounts receivable balance for the sector is 4.4 billion, with a year-on-year increase of +0.3%, and the accounts receivable impairment ratio has risen to 28%, up by 7 percentage points [3][44][45]