Investment Rating - The report maintains a "Buy" rating for the company [4][6] Core Views - The company achieved a robust growth in core net profit, with a 100% distribution of core net profit. For the first half of 2025, the company reported revenue of 8.52 billion RMB, a year-on-year increase of 6.5%, and a net profit attributable to shareholders of 2.03 billion RMB, up 7.4%. The core net profit reached 2.01 billion RMB, reflecting a 15% increase, indicating that the growth rate of core net profit outpaced revenue growth due to a 3.1 percentage point increase in gross margin to 37.1% [1][4] Summary by Sections Commercial Channel - The company solidified its leading position in shopping centers, with retail sales growth outpacing the overall retail sales growth. In the first half of 2025, the company opened 4 new shopping centers and signed 6 new light-asset projects, increasing the number of operational shopping centers to 125. The retail sales from operational shopping centers reached 122 billion RMB, a year-on-year increase of 21.1%, significantly surpassing the overall retail sales growth of 5% [2] Property Channel - Urban space revenue grew rapidly, while community space revenue slightly declined due to value-added service revenue. In the first half of 2025, community space services generated revenue of 4.21 billion RMB, a decrease of 1.6%. The revenue from property management services increased by 8.8% to 3.5 billion RMB, while non-owner value-added services saw a decline due to reduced project deliveries and lower service prices [3] Financial Projections - The company is projected to achieve revenues of 19.19 billion RMB, 21.21 billion RMB, and 23.26 billion RMB for the years 2025, 2026, and 2027, respectively. The net profit attributable to shareholders is expected to be 4.17 billion RMB, 4.74 billion RMB, and 5.29 billion RMB for the same years. The earnings per share (EPS) are forecasted to be 1.83 RMB, 2.07 RMB, and 2.32 RMB, with corresponding price-to-earnings (P/E) ratios of 18.7, 16.5, and 14.7 [4][5]

Core Viewpoint - China Resources Vientiane Life is a leading property management and commercial operation service provider in China, backed by a strong central enterprise, China Resources Land, which holds over 72% of the shares, ensuring a stable and concentrated ownership structure [1][2] Commercial Sector - The company operates 122 shopping centers, maintaining its position as an industry leader, with expected new openings of 6, 6, 6, and 5 shopping centers from 2025 to 2028, contributing to performance growth [1] - Retail sales in 2024 are projected to grow by 4.6% year-on-year, outperforming the overall retail sales growth, with luxury malls achieving a 1.8% increase despite a cooling market [1] - Key factors contributing to the company's resilience include early market entry, a strong portfolio of shopping centers attracting premium brands, clear product line positioning, a robust membership system ensuring stable foot traffic, and high operational efficiency with a 19.2% increase in rental income to 26.2 billion yuan in 2024 [1] Property Management Sector - The company benefits from a solid foundation due to its parent company, China Resources Land, which has a strong performance in sales and land acquisition, providing stable project deliveries [2] - As of 2024, the company has a contracted area of 450 million square meters and a managed area of 410 million square meters, reflecting year-on-year growth of 5.9% and 11.6% respectively [2] - The company is actively expanding through market outreach, acquisitions, and joint ventures, with a 19.8% increase in managed urban space area to 12.5 million square meters, raising the overall business segment's share to 30% [2] Financial Analysis - The company reported a revenue of 17.04 billion yuan in 2024, a year-on-year increase of 15.4%, with a net profit of 3.63 billion yuan, up 23.9%, driven by improved gross margins and reduced expense ratios [2] - The company has maintained a 100% dividend payout ratio for two consecutive years, with the fixed payout ratio increasing from 37% in 2021 to 60% in 2024 [2] Investment Recommendation - As a leader in the commercial real estate sector with a robust project pipeline and stable operations, the company is expected to achieve revenues of 19.19 billion, 21.21 billion, and 23.26 billion yuan in 2025, 2026, and 2027 respectively, with net profits of 4.17 billion, 4.74 billion, and 5.29 billion yuan [3] - The company is compared to benchmark property management firms, showing a premium valuation due to its unique dual business model, superior performance, and high dividend yield of 4.3% [3] - The estimated reasonable market value is 91.8 billion yuan, with a target stock price of 40.2 yuan per share, initiating coverage with a "buy" rating [3]