CIFI Holdings is an investment holding company based in the People's Republic of China. Co. is engaged in property development, property investment and provision of property management and property related services. Co.'s residential property development activities focus on developing quality, mass market residential properties with small-to-medium unit sizes, comfortable living environment and locations with good public transportation links. Co.'s commercial property development activities focus on developing office properties-for-sale. Additionally, Co. provides property management services to residential and commercial customers through the property management companies.
KWG Property Holding is an investment holding company. Co.'s portfolio provides different types of products, which include mid- to high-end residential properties, serviced apartments, villas, office buildings, hotels and shopping malls. Co.'s segments include: property development, which is engaged in the sale of properties; property investment, which is engaged in leasing of properties; hotel operation, which is engaged in the operation of hotels; and property management, which is engaged in the provision of property management services.
Times Property Holdings is a property developer in China, focusing on the development of mid-market to high-end residential properties. Property development is the development of residential and commercial properties for sale. Property leasing is the development, leasing and sub-leasing of commercial properties owned by Co. or independent third parties. Property management is the provision of property management services to Co.'s residential customers. Co. has expanded its business to Guangzhou, Foshan, Zhuhai, Zhongshan, Qingyuan and Changsha.
Zhenro Properties Group Ltd. Zhenro Properties Group Limited is an investment holding company principally engaged in the sale of properties. Along with its subsidiaries, the Company provides sales of properties, property leasing business, provision of commercial property management services, and sales of goods and provision of design consultation services.
Last week (7- 13 July), 37,011 new houses were sold in the 30 cities we monitor, down 6.0% wow. Transaction area totalled 3.87m sqm, down 6.1% wow. New inventory in 15 cities increased 61.3% wow. Transaction-to-new-launch ratio reached 1.30x, higher than the 0.75x in the week of 30 June-6 July. Leading developers are trading at 4.1-9.2x 2019F PE and at a 21.4-65.2% discount to NAV last week. Maintain OVERWEIGHT.
With the government’s efforts to foster and develop city clusters in China, we see huge housing demand in core metroplolitan areas arising from urbanisation and cross-regional population flows into those areas. The YRD and GBA will remain the main magnets for population in the future, given their vast potential. Urbanisation rates in YRD (68.5%) and GBA (84.4%) are higher than in the rest of China (59.58%). Maintain OVERWEIGHT. Our top picks are CIFI, Ronshine and Times China.
With the government’s efforts to foster and develop city clusters in China, we see huge housing demand in core metroplolitan areas arising from urbanisation and cross-regional population flows into those areas. Naturally, the YRD and GBA will remain the main magnets for population in the future, given their vast potential. Urbanisation rates in YRD (68.5%) and GBA (84.4%) are notably higher than in the rest of China (59.6%). Maintain OVERWEIGHT with CIFI, Ronshine and Times China as top BUYs.
KEY HIGHLIGHTS CHINA Sector Education Online K12 AST regulations have minimal impact on leading K12 AST players. Small/Mid Cap Highlights China Display Optoelectronics Technology (334 HK/HOLD/HK$0.57/Target: HK$0.65) Margin squeeze concern; processing agreement with parent company. TRADERS’ CORNER CNBM (3323 HK): Trading Buy Range Minth Group (425 HK): Trading Buy Range
The long anticipated online K12 regulations have finally been announced, and remove some of the regulatory overhang on the K12 AST segment. We view the regulations as mildly negative as rules on teaching hours and prepaid fee collection are slightly more stringent than offline K12 AST. Similar to management guidance, we think both leading K12 AST players will be able to meet regulatory requirements and expect strong results to be announced next week. Excluding the post-K12 segment in the education sector, we prefer EDU over TAL. Maintain OVERWEIGHT.
Home prices moderated as the CCL index fell 0.37% wow to 189.77 in the week ending 7 Jul 19. For the week ending 14 Jul 19, the HSP index fell 1.84% wow; weekend primary market sales volume rebounded wow and weekend secondary market sales volume fell 37.5% wow in the 10 major estates tracked by Centaline. Maintain MARKET WEIGHT.
KEY HIGHLIGHTS CHINA Economics Money Supply TSF growth picks up but bank credit growth slows; expect more targeted easing. Trade Trade surplus beats on the back of weak imports. Sector Machinery Upbeat 1H19 results to boost market sentiment. HONG KONG Sector Property Weekly wrap-up: Cautiousness after home prices hit record high.
CHINA Economics Money Supply: TSF growth picks up but bank credit growth slows; expect more targeted easing. Trade: Trade surplus beats on the back of weak imports. Sector Machinery: Upbeat 1H19 results to boost market sentiment. HONG KONG Sector Property: Weekly wrap-up: Cautiousness after home prices hit record high. INDONESIA Update Gudang Garam (GGRM IJ/BUY/Rp74,000/Target: Rp88,100): Expect >30% yoy net income growth in 2Q19 as volumes and prices increase. MALAYSIA Results DiGi.Com (DIGI MK/BUY/RM5.05/Target: RM5.40): 2Q19: Earnings within expectations amid robust post-paid revenue growth...
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