Poly Real Estate (600048): 2019 performance exceeds expectations and raises target price to 20 yuan

Poly Real Estate (600048): 2019 performance exceeds expectations and raises target price to 20 yuan

Event: The company released a performance report. In 2019, it realized total operating income of 235.5 billion yuan, an increase of 21% year-on-year; realized operating profit of 50.3 billion yuan, an increase of 41%; net profit attributable to shareholders of listed companies was 26.6 billion yuan, an increase of 41%; Realize basic benefits.


23 yuan, a year-on-year increase of 40%.

Comments: The carry-over of Q4 2019 is extremely positive, and the growth rate of profits has increased significantly in Q1-3 of 2019. The company’s total operating income, operating profit, and net profit attributable to mothers have increased by 18%, 29%, and 34%, among which Q2 performed the most beautifully.The growth rates of the three indicators were 23%, 43%, and 66%.

Q4 ushered in 四川耍耍网 the peak delivery period at the end of the year, and the company’s profit release accelerated again. The growth rates of the three indicators in the single quarter reached 24%, 54%, and 48%, respectively.

First of all, from the point of view of the carry-over calculation, we can see that the sale is plentiful, the carry-over is positive, and the scale of property management can be expected to expand-Poly Real Estate (600048.

(SH) Dynamic Tracking Report “clearly indicates that the company’s completion rhythm is preliminary (the area completed in Q1-3 in 2019 increased by 47%), showing a positive intention to carry forward, and the growth rate of total operating income in Q4 2019 will rise to 24% as scheduled.

In terms of preliminary profit performance, the growth rate of operating profit in the fourth quarter of 2019 (+ 54%) clearly exceeded the growth rate of total revenue (+ 24%). The resulting fourth quarter of 2018 accrued approximately $ 2.4 billionThe loss of asset value led to a reduction in the base number. If this factor is excluded, the adjusted growth rate of operating profit corresponding to the fourth quarter of 2019 will be about 33%.

In addition, in the fourth quarter of 2019, we expect the company’s on-balance sheet high average price items to be accounted for will lead to an increase in the settlement gross profit margin, and off-balance sheet items will meet the peak delivery and increase the proportion of their contribution to profits.

The growth rate of net profit attributable to mothers in Q4 2019 (+ 48%) is slightly lower than the growth rate of operating profits, or it may indicate that the minority shareholders’ profit and loss accounted for an increase compared to the 2018Q4 level (26%).

The overall performance growth exceeded market expectations, and the level of profit rose to the highest level since 2014. From the perspective of 2019, the company’s revenue has grown steadily, and the growth rate (+ 21%) is basically in line with the long-term completion target growth rate (+ 24%).
The net profit attributable to mothers was initially realized at US $ 26.6 billion, an increase of 41% year-on-year, exceeding market expectations (the net profit attributable to mothers in 2019 exceeded the WIND consensus forecast value of the results announcement day by 8%).

Adjusted operating profit margin, net profit margin attributable to mothers increased by 3.

One, one

6 to 21.

4%, 11.

3%, the average return on average net assets increased by 2.

2 to 18.

8%, the profit level rose to the highest level since 2014.

As of the third quarter of 2019, the company’s on-balance sheet advance receipts were approximately 3829 trillion. After taking into account the sales and carry-over amounts in the Q4 forecast table, it is conservatively estimated that the year-end advance receipts will be approximately 3250-3350 trillion, equivalent to the total turnover in 2019.140% of the revenue can fully cover our forecast of the company’s operating income in 2020, and the follow-up settlement guarantee is relatively high.

The land acquisition strategy turned positive in December, and gradually increased the proportion of soil reserves and equity to 70%. In December 2019, the company’s investment strategy turned positive, adding 28 projects in a single month, and the total land price reached 38.2 billion, compared with the three months of 9-11.The total land price is about 30.7 billion yuan. In December, 6.94 million countries were replenished with land reserve plans, compared with 7.05 million nations in the three months from September to November.

Because the company is cautious in acquiring land from January to November, it will increase the land reserve construction area by about 26.75 million countries after 2019, a decrease of 14% over the years; the total land price of additional land reserves will be about 1555 trillion, which will gradually decrease by 15%; the amount of land acquisition / sales amountThe ratio is about 34%, compared with 48% in 2018; the ratio of land acquisition area / sale area is about 86%, and the replenishment scale is smaller than the de-sale scale; the ratio of land acquisition price / average sales price is about 39%, which is basically the same as 2018Flat.

Calculated by area, the company’s new soil storage equity ratio was approximately 71%, an increase of 3pc from 2018; in terms of amount, the company’s new soil storage equity ratio was approximately 70%, an increase of 7pc from 2018.

+ 14% for the whole year of 2019, the scale is stable in the TOP5 industry, and the state-owned enterprise real estate TOP1 in 2019, the company achieved sales of 461.8 billion yuan, an increase of 14% year-on-year; realized a comprehensive sales area of 3213, an increase of 13%; the average sales price of about 14,788 yuan / square meter, An increase of 4% per year.

According to CRIC data, the company’s sales scale continues to remain in the industry’s TOP5 and central SOE real estate companies’ TOP1.

Considering that the company has sufficient land reserves and is mainly located in first-tier and second-tier cities, we expect that the scale of delivery and the level of dechemicalization will still be supported in 2020, and the sales amount may continue to maintain double-digit growth.

Estimates and ratings take into account that the company’s sales growth has picked up in December, and the land has turned to be positive. With reference to the 2019 performance report data, we raised the company’s forecasted net profit for 2019-2021 to 266,318,36.2 billion (originally 246).294, 32.4 billion), the corresponding forecast EPS is raised to 2.

23, 2.

67, 3.

04 yuan (was 2).

07, 2.

47, 2.

73 yuan).

The current sustainable corresponding companies predict that PE will be about 7 in 2019-2021.

0, 5.

8, 5.

1 time, the predicted index rate is about 4.

3%, 5.

2%, 5.9%, the estimated level is earlier than Vanke A. The average discount of China Merchants Shekou is more than 20%, which is attractive.

The company has deep resource reserves, excellent credit ability, medium-sized sales market share to increase the prospects and clarity, and high certainty that its performance will maintain stable growth.

The development of the two wings business has accelerated, and the property has been separated and listed, and subsequent scale expansion can be expected.

We maintain the company in July 2020.

5x forecast PE estimate, corresponding target price is raised to 20.

00 yuan, maintain “Buy” rating.

Risk warning: the real estate continues to improve, the company’s push to sell, the gross profit margin of sales is less than expected; the company’s completion, the settlement progress is less than expected.