Summary of Key Points from the Conference Call Industry Overview - The focus is on the **A-share market** in China, specifically the **Shanghai Composite** and **CSI300** indices, which are experiencing significant upward momentum, testing 10-year highs as of August 2025 [2][10]. Core Insights and Arguments 1. **Market Performance**: - The Shanghai Composite has delivered an **11%** return year-to-date (YTD), while the CSI300 has returned **8%**. The Shanghai Composite officially crossed the **3,700** level on August 15, 2025, a level not seen since late 2015 [2][10]. - The CSI300 index surpassed **4,200**, a level briefly reached in late September 2024 and January 2023 [2]. 2. **Bond Yield Trends**: - Onshore long-term bond yields have increased, with the **10-year yield** at **1.78%** and the **30-year yield** at **2.11%**, reflecting a more constructive macro outlook among investors [3][11]. - This contrasts with previous periods in September 2024 and early 2023, where bond yields indicated skepticism towards the macro outlook [3]. 3. **Liquidity and Economic Indicators**: - The **MS Free Liquidity Indicator** turned positive in June 2025 for the first time since early 2024, indicating improved onshore liquidity driven by strong government bond issuance [4]. - The **anti-involution initiative** is gaining momentum, positively impacting market sentiment and expectations for domestic price stabilization [5]. 4. **Policy Expectations**: - The State Council's recent meeting reaffirmed a pro-growth stance, emphasizing consumption, infrastructure projects, and urban renewal as key policy levers [8]. - There is anticipation of localized housing market easing measures in response to a broad-based slowdown [8]. 5. **Investment Rotation**: - Rising bond yields may lead to a rotation from bonds and term deposits into equities, as current deposit options become less attractive [9]. 6. **Future Outlook**: - The A-share market is expected to continue outperforming the offshore market through the summer, with a target for the CSI300 to reach **4,700** in the near term [10]. - Key indicators to monitor for sustainability of the rally include onshore bond yields, policy catalysts, 2Q earnings results, and potential government intervention regarding margin financing [11]. Additional Important Insights - The margin financing balance has exceeded **RMB 2 trillion** (approximately **USD 290 billion**), a level last seen in 2015, indicating increased leverage in the market [11]. - The current margin financing balance is **4.8%** of free float market cap, slightly below the 10-year average of **4.9%** [11]. - Analysts suggest that immediate government intervention due to over-leverage concerns is unlikely unless both margin financing measures increase rapidly [11]. This summary encapsulates the key points discussed in the conference call regarding the A-share market's performance, macroeconomic indicators, policy expectations, and future outlook.

Investment Rating - The report maintains a "Buy" rating for C&D International, CR Land, and China Jinmao, while holding a "Hold" rating for COLI [27][29]. Core Insights - The strong share price momentum in the China real estate sector is attributed to the market's rapidly rebuilding of policy expectations, with investors optimistic about government efforts to stabilize the housing market [2][3]. - A bottom-up approach is emphasized, focusing on stocks that can remain resilient despite potential sales slowdowns, particularly state-owned enterprises (SOEs) that can monetize their assets effectively [3][4]. - The report highlights three key stocks: CRL for its quality investment property portfolio, C&D for its young landbank, and China Jinmao for its luxury project track record [4][8]. Summary by Sections Market Overview - Recent sales data shows a mixed performance across different tiers of cities, with Tier-1 cities experiencing a 36% year-on-year decline in sales, while Tier-2 and Tier-3 cities showed smaller declines of 19% and 18% respectively [9]. Stock Analysis - CR Land is noted for its strong sales momentum and solid execution track record, with a target price of HKD 36.30, implying a 26.5% upside [29]. - C&D International is highlighted for its competitive edge and expected margin recovery, with a target price of HKD 21.20, indicating a 27.4% upside [29]. - China Jinmao is recognized for its turnaround story and ambitious sales targets, with a target price of HKD 1.60, suggesting a 28% upside [29]. - COLI faces uncertainty regarding its investment thesis, leading to a "Hold" rating, with a target price of HKD 14.80, reflecting a 10.8% upside [29]. Valuation Metrics - The report provides a valuation summary for various property developers, indicating significant discounts to net asset values (NAV) for several companies, with CR Land and C&D International showing promising upside potential based on their current valuations [27][29].