Core Viewpoint - China Resources Vientiane Life and Kering Group have established a strategic partnership focused on sustainable development, initiating a "Sustainable Development Strategic Cooperation Plan" to promote zero-carbon stores and advocate for sustainable lifestyles [1][3]. Group 1: Partnership and Objectives - The partnership aims to integrate China's "dual carbon" strategy with green building standards, creating a template for sustainable retail stores in China [1][3]. - The collaboration includes a clear short, medium, and long-term cooperation path, focusing on energy efficiency, green electricity application, and carbon management [3]. - The partnership is supported by a joint research and development center established by China Resources Land and Tsinghua University, ensuring innovative and professional practices throughout the project lifecycle [3]. Group 2: Commitment to Sustainability - The partnership responds to national "dual carbon" goals and aims to exceed China's green building standards, establishing a benchmark for international brands in the Chinese market [3]. - The collaboration is expected to provide Kering with a replicable and efficient model for sustainable stores, accelerating the zero-carbon transformation of its brands in China [3]. Group 3: Leadership and Recognition - China Resources Vientiane Life has been recognized for its commitment to responsible development and sustainable practices, being listed in the "China ESG Pioneer 100" for three consecutive years and achieving an "A" MSCI ESG rating [5]. - Kering Group has a strong commitment to sustainability, consistently recognized as an industry leader by various non-financial rating agencies and lists, including being named a top sustainable company in the "Global 100" [6].

Group 1 - The company reported a revenue of RMB 8.524 billion for the six months ending June 30, 2025, representing a growth of 6.5% compared to the previous period [1] - The commercial channel business generated revenue of RMB 3.267 billion, an increase of 14.6%, while the property channel business revenue was RMB 5.157 billion, growing by 1.1% [1] - The gross profit for the period was RMB 3.165 billion, up 16.3%, with the gross margin improving from 34.0% to 37.1% [1] Group 2 - The profit attributable to shareholders was RMB 2.030 billion, reflecting a year-on-year increase of 7.4% [1] - The core net profit attributable to shareholders, measured on a non-Hong Kong Financial Reporting Standards basis, reached RMB 2.011 billion, a growth of 15.0% [1] - The company declared an interim dividend of RMB 0.529 per share and a special dividend of RMB 0.352 per share [1] Group 3 - As of June 30, 2025, the company operated 120 shopping centers and 27 office buildings, with 5 sub-leased shopping center projects [2] - The total managed building area for property management services was 420 million square meters, excluding shopping center projects [2]

Investment Rating - The report assigns an "Accumulate" rating to the company for the first time [4][6]. Core Insights - The company is a leading property management and commercial operation service provider in China, employing a comprehensive "2+1" business model that integrates commercial management, property management, and a large membership system [1][17]. - Revenue has grown from 3.129 billion in 2017 to 14.767 billion in 2023, with a CAGR of approximately 30% [1][23]. - The company has achieved a strong average gross margin of around 31%, net margin of 19%, and ROE of 15% from 2021 to 2023 [1][23]. Summary by Sections Company Overview - The company focuses on creating an integrated ecosystem for property management and commercial operations, emphasizing "space," "customers," and "products and services" [17]. - It has expanded its operations across various business segments, including residential property management and commercial property management [17][18]. Industry Situation - The overall property management and commercial operation market in China has seen steady growth, with total revenue increasing from 282.8 billion in 2014 to 714.6 billion in 2023, reflecting a CAGR of 10.8% [45]. - The market is expected to reach 955.4 billion by 2028, with a projected CAGR of 6.0% from 2023 to 2028 [45]. Financial Performance - The company forecasts revenues of 17.453 billion, 19.932 billion, and 22.577 billion for 2024, 2025, and 2026, respectively, with corresponding net profits of 3.440 billion, 3.975 billion, and 4.585 billion [4][12]. - The company has maintained a strong financial performance, with a net profit margin that has improved from 6% in 2020 to 20% in 2023 [30]. Competitive Advantages - The company benefits from a diversified service offering and strong brand resources, which have enabled it to achieve growth rates significantly above the industry average [2][3]. - The company has a strategic focus on high-quality customized services and digital transformation, which are expected to drive future growth [2][3].