中国房地产预览：整体业绩强劲派息良好

1、Deutsche Deutsche ResearchAsiaChinaPropertyPropertyIndustryChinaPropertyDate18 February 2019Forecast ChangePreview: Overall strong results withgood dividend payoutOverall strong FY18F results with 30% earnings growthOverall, we expect strong FY18 results for the developers we cover (Fig 1): 1)30% ea

2、rnings growth on average due to strong sales in the past two years;2) gross margin staying high at 33% (vs. 32.9% in FY17) due to ASP rally in 2016-17;3)stabledividendpayoutratio(6%yield);albeitwith4)higheraverage borwingcostto6%(vs.5.6%/5.3%in1H18/FY17)andhighernetgearingdue totightercredit/slersal

3、esin2H18.OurFY18-20earningsorecastsare in line with Bloomberg consensus, but we are more bullish on Sunac andLandontheir2018earnings.Also,wethinkdevelopersonthewholewilltogiehigh-teensalesgwthguidance(5-15%orlarge-capsand20%or small-caps)for2019despiteanoverallweakerphysicalmarket.Who might beat and

4、 who might miss?Within our coverage, we expect more than half to report strong results earningsgrowth),andone-thirdtoreportdecentresults(Figure1).Inparticular, Sunac, Future Land, Logan, Evergrande, Aoyuan and Gemdale should 40% earnings growth due to their strong sales and margin expansion, while C

5、ountryGarden,Longfor,CIFI,ChinaJinmao,GZR&F,andTimesshoulddeliver 30-35% earnings growth. Our FY18F earnings on Sunac and Future Land are and 8% above consensus, while CR Land and KWG might report slightly weaker-than-consensus earningsgrowth. HYPERLINK mailto:jeffrey.gao Jerey Gao, Research +852-22

6、03 6256 HYPERLINK mailto:stephen-a.cheung Stephen Cheung, CFA Research Analyst+852-2203 6182 HYPERLINK mailto:foo.leung Foo Leung Research Associate+852-2203 6239Key ChangesKey ChangesCompanyPriceRating1813.HK12.23to11.69-3380.HK11.43to12.30-1109.HK34.77to35.84-2007.HK16.97to17.19-3883.HK7.99to8.97-

7、2202.HK30.64to31.31-000002.SZ27.23to27.22-Source: Deutsche BankSource: Deutsche BankChina China Figure 1: Top picksWhat are the potential surprises?Figure 1: Top picksSource: Deutsche Bankthink there could be positive surprises on dividends with Future Land and Longforpossiblyraisingtheirpayoutratio

8、s,whileLoganmightcontinuetoaspecialdividend.Also,overallgrossmarginshouldremainhigh,particularlyCOLI, CR Land, Logan, GZ R&F, Agile and China Jinmao. In terms of surprises, the net gearing ratio of Agile, Greentown and Aoyuan could increase due to aggressive landbanking or slowsales.Source: Deutsche

9、 BankThis report includes changes to target prices and forecasts for several companies under coverage; please see the table at right and discussion following Figure 7.DeutscheBankAG/Hongongofthisreport.Investorsofthisreport.Investorsshouldthisreportasonlyasinglefactorinmakingtheirinvestmentdecision.

10、DISCLOSURESANDCERTIFICATIONS ARE LOCATED IN APPENDIX 1. MCI (P) 091/04/2018. THE CONTENT MAY BE DISTRIBUTED IN THE PEOPLES REPUBLIC OF CHINA (THE PRC) (EXCEPT IN COMPLIANCE WITH THE APPLICABLE LAWS AND REGULATIONS PRC), EXCLUDING SPECIAL ADMINISTRATIVE REGIONS OF HONG KONG ANDMACAU.7T2se3r0Ot6kwoPaO

11、verall 15% sales growth guidance likely, with mid-caps continuing to outperformAlthough the overall physical market might turn weaker this we listeddeveloperswillgive15%salesgrowthguidanceonaverage(especiallyfor mid/small-caps),gientheirabundantsaleableresourcesand/orstong amid a market downturn. ex

12、pect high-teen sales growth on average for developers we with mid-caps outperforming large-caps (5-15% for caps and 25% or mid/small-caps). In particula, e xpect seral names to deliver 30% sales growth, including Future Land, Logan, KWG, China Jinmao, Aoyuan, and ChinaSCE.We prefer mid-caps over lar

13、ge-capsAlthoughweexpecttheweakphysicalmarkettocontinueinto1H19,wepositiveoverallonthesectorona12-monthhorizoninviewoftheimprovingcredit environmentandearningsvisibility.Overall,weexpectqualitymid-capto outperorm large-caps, gien their stonger sales/earnings gwth andcheapervaluations.suggestinvestors

14、buyabasketofmid-caps,including Sunac, Future Land, Shimao, Logan, CIFI, and KWG. value stocks NAV or xisting pojects. y risks: credit/poliy tightening/loosening or depreciation/appreciation.Figure 2: Summary of FY18F results previewDeveloperTickerEstimatedresults dateOverallcommentRevenueGross margi

15、nFY17FY18FCore profitsDividendNet gearingFY17FY18FAgile3383 HK20-MarDecent20% growth40.1%40%25-30% growthStable96%100%Aoyuan3883 HK18-MarStrong60% growth26.7%27-28%55% growthStable51%70-80%China Jinmao817 HK19-MarStrong30% growth32.3%35%30% growthStable139%100%China SCE1966 HK20-MarFair10% growth34.

16、1%30-31%10-15% growthStable79%60+%CIFI884 HK17-MarStrong20-25% growth27.1%30%30-35% growthStable70%80%CMSK001979 CH18-MarDecent20-25% growth35.3%35%25-30% growthStable66%70-80%COLI688 HK20-MarDecent20% growth32.9%36%10-15% growthStable27%35-40%Country Garden2007 HK18-MarStrong50% growth25.9%25-26%35

17、-40% growthStable57%40%20-30% growthStable36%40-45%Evergrande3333 HK26-MarStrong60% growth36.1%35%50-60% growthStable184%130-140%Future Land1030 HK8-MarStrong40% growth33.3%33-34%60% growthHigher100%35%40-50% growthStable44%20% growth19.2%17-18%DeclineStable75%100%GZ R&F2777 HK20-MarStrong35-40% gro

18、wth35.4%37-38%30% growthStable180%180%KWG1813 HK25-MarDecent20-30% growth34.8%34-35%20% growthHigher68%80%Logan3380 HK19-MarStrong40% growth34.4%34-35%50% growthHigher84%30% growthHigher48%60%Shimao813 HK26-MarStrong20-25% growth30.4%31-32%30% growthStable63%100% growth20.7%25%40% growthStable257%16

19、0%Times1233 HK12-MarStrong35-40% growth27.9%26-28%30% growthStable58%60-70%Vanke2202 HK26-MarDecent30% growth32.3%32-33%20% growthStable9%20% earnings CAGR in FY18-20F with gross margin to remain high at over 34%; 3) net gearing ratio and average nancing cost to stay low; and 4) 5-7% dividend yield

20、for FY18-20F.ValuationOur NAV estimate values existing landbank and properties based on athe-parts methodology: 1) we use DCF to value the companys properties, with a WACC of 9.7% (we apply a risk-free rate of 3.0%, beta of 1.6, risk premium of 6.0% and cost of debt at 4.4%); and 2) we use a rateapp

21、roach(caprateof5-9%)tovalueinvestmentproperties.Inourmodel, weassumefullprepaymentofthelandappreciationtax.assumeproperty prices will grow 5% in T1/T2/T3 cities in 2018 and remain at thereafter. Our target price is based on a discount to our NAV estimate, based on assessmentofeightmeasuresforthecomp

22、anieswecover(productlandbank quality, scale, leverage, growth prospect, protability, advantage,andexecution).ThebenchmarkindexforthestockisMSCIChina.RisksMacro risks include: Government property tightening measures that be stricter than expected, which could result in volatile moves in transaction v

23、olumes, housing prices, land prices, and nancing available developersandhomebuyers.Unexpectedeconomicuctuationsintheeconomy also add risks to the sector. In addition, potential RMB may result in FX losses for developers with oshore nancing. Company- specic risks include: 1) slower sales due to the w

24、eaker physical market; slower rental growth due to the delay in mall launches; and 3) expected gross marginexpansion.Model updated: 15 February 2019Fiscal year end 31-Dec2015201620172018E2019EModel updated: 15 February 2019Fiscal year end 31-Dec2015201620172018E2019E2020ERunning the numbersFinancial

25、 SummaryAsiaDB EPS (CNY)0.870.971.141.311.852.44ChinaReported EPS(CNY)1.150.291.150.511.170.411.310.521.860.742.450.98PropertyBVPS(CNY)9.510.612.1Weighted average shares (m)2,9683,0213,0983,1613,1743,17414,03612,45016,96319,81219,81219,812Enterprise value (CNYm)7,6559,5593,94712,939-5,890-25,158Reut

26、ers:1813.HKBloomberg:1813HKValuationMetricsP/E (Reported) (x)Price (15Feb19)HKD7.24P/BV(x)0.630.480.910.660.590.52 FCF Yield(%)nmnmnmnm106.8114.3TargetPriceHKD11.69Dividend Yield(%)8.411.915.7KWGAverage market cap (CNYm)KWGBuyP/E (DB) (x)Buy EV/Sales(x)0.9-0.3-0.752 WeekrangeHKD 5.17- 13.02

27、EV/EBITDA(x)2.9-1.1-3.1 EV/EBIT(x)2.9-1.1-3.1Income Statement (CNYm)Sales revenue8,3408,86511,54314,01123,50134,466Income Statement (CNYm)Sales revenue8,3408,86511,54314,01123,50134,466Company ProfileCompany ProfilePrice Performance15Price Performance1512.5107.552.5Grossprofit3,009

28、3,0704,0204,7867,42510,503EBITDA1,9902,2222,4584,4505,4988,228Depreciation000000Amortisation000000EBIT1,9902,2222,4584,4505,4988,228Netinterestincome(expense)3010-6-538-133-132Associates/affiliates1,9332,1301,8982,0373,0323,026Exceptionals/extraordinaries7101661,205102131Otherpre-taxincome/(expense)

29、000000Profitbeforetax4,6624,5275,5555,9598,41811,154Incometaxexpense1,2491,0661,9501,8652,5433,091Minorities-3-3-15-61-25286Otherpost-taxincome/(expense)000000Netprofit3,4163,4653,6204,1555,9007,777DB adjustments(includingdilution)-820-543-97-8-16-24DBNetprofit2,5962,9223,5234,1475,8857,753Jul 17Jan

30、 18Jul 18Jan 19Cash Flow(CNYm)KWGHANG SENG INDEX (Rebased)Cash flow from operations101-2,891-9,469-1,14523,14723,726Net Capex-239-320-409-3,400-1,989-1,071Margin Trends353025201516Margin Trends3530252015161718E19E20EEquityraised/(bought back)400000Dividendspaid-725-654-1,093-1,659-2,354-3,101Net inc

31、/(dec)inborrowings2,81015,01626,13922,36200Other investing/financingcashflows-1,1313,655-1,708-3,9642,684-710Netcash flow82014,80713,45912,19421,48918,844Change inworkingcapital765-2,547-9,307-5,41017,08515,473Balance Sheet (CNYm)Balance Sheet (CNYm)Growth & Profitibility7550250-2522.520Growth & Pro

32、fitibility7550250-2522.52017.51512.515161718E19E20ESalesgrowth(LHS)ROE(RHS)Cash and otherliquidassets12,56626,90240,46752,66174,15092,994Tangiblefixedassets13,24314,42417,89221,12122,92323,803Goodwill/intangibleassets000000Associates/investments21,83018,99832,83240,05737,37338,080Otherassets32,04250

33、,41843,75366,02365,00556,687Totalassets79,681110,742134,945179,862199,450211,564Interestbearingdebt27,99842,95059,64582,00782,00782,007Otherliabilities29,32543,78347,05463,91379,98087,135Totalliabilities57,32386,733106,699145,920161,987169,142Shareholdersequity22,34123,95027,60730,10333,65038,325Min

34、orities18586383,8393,8144,097Totalshareholders equity22,35924,00928,24633,94237,46342,422Key Company MetricsNetdebt15,43216,04819,17829,3467,857-10,987Key Company MetricsSolvency250200150100500-5015161718E19E20E5004003002001000Salesgrowth(%)-20.36.330.221.467.746.7DB EPSgrowth(%)-1.110.617.615.441.3

35、31.8EBITDAMargin (%)23.925.121.331.823.423.9EBITMargin (%)23.925.121.331.823.423.9Payoutratio (%)25.244.534.839.839.939.9ROE (%)16.015.014.014.418.521.6Capex/sales(%)Net debt/equity (LHS)Net interest cover (RHS)Net debt/equity (%)69.0Net debt/equity (LHS)Net interest cover (RHS)Ne

36、t debt/equity (%)69.066.867.986.521.0-25.9Stephen Cheung, CFA+852 2203 6182 HYPERLINK mailto:stephen-a.cheung stephen-a.cheungNet interest cover (x)Source: Company data, Deutsche Bank estimatesnmnm398.88.341.562.2OutlookhaveaBuyratingonthecompany.GivenitsrichsaleableresourcesinT1/2 cities and faster

37、 turnover following the adoption of a co-investment we expect KWG to sustain its rapid growth with 40% sales gains in 2019. forecast40%rentalCAGRinFY18-20,givenastrongIPpipeline.expecta 30% earnings CAGR and 8-15% dividend yields in FY18-20. KWG is one of toppicksamongmid/small-caps.ValuationOur end

38、-FY19 NAV estimate values existing landbank and properties a sum-of-the-parts methodology: 1) we use DCF to value the companys development properties, with a WACC of 11.8% (we apply a risk-free rate of 3.0%, beta of 2.0, risk premium of 6.0% and cost of debt at 7.0%); 2) we use a cap-rate approach (

39、5-9%) to value investment properties. assumefullprepaymentofthelandappreciationtax.Intermsofpropertyprice assumptions,weassumepricesinT1/T2/T3citieswilldrop5%y-yin2019remainatthereafter.Ourtargetpriceisbasedona45%discounttoourNAV estimate, reecting our assessment of eight measures for the companies

40、weThebenchmarkindexforthestockisMSCIChina.RisksMacro risks include: Government property tightening measures that may be stricter than expected and unexpected economic uctuations in the Chinese economy. Potential RMB depreciation could result in an FX loss for developers with oshore nancing. Company-

41、specic risks include: 1) expected sales; 2) faster-than-expected gross margin squeeze; and 3) higher net gearing due to overly aggressive land acquisition.Fiscal year end 31-Dec201520162017Fiscal year end 31-Dec2015201620172018E2019E2020EFinancial SummaryDB EPS (CNY)0.450.541.161.572.162.72Reported

42、EPS (CNY)0.430.521.221.572.162.72DPS (CNY)10.550.760.95BVPS (CNY)5.67.08.8Weighted average shares (m)21,80622,07621,22421,70921,64821,648Average market cap (CNYm)56,05666,165171,117195,577196,151196,151Enterprise value (CNYm)99,33497,794203,096254,90749,542-102,300Valuation MetricsP/E (DB) (x)P/E (R

43、eported) (x)6.04.23.3P/BV (x)0.691.142.941.601.281.03FCF Yield (%)nm59.613.1nm118.994.1Dividend Yield (%)5.05.85.06.18.410.6EV/Sales (x)0.70.1-0.2EV/EBITDA (x)3.90.6-1.1EV/EBIT (x)3.90.6-1.1Income Statement (CNYm)Sales revenue113,223153,087226,900351,028512,927641,157Gross profit22,86332,23658,78591

44、,797122,892132,144EBITDA15,36921,41343,09365,64690,06594,316Depreciation000000Amortisation000000EBIT15,36921,41343,09365,64690,06594,316Net interest income(expense)-1,290-1,0953,276-487-930-815Associates/affiliates-56362-3521,1841,4645,150Exceptionals/extraordinaries000000Other pre-tax income/(expen

45、se)810712505000Profit before tax14,83321,39146,52266,34390,59998,650Income tax expense5,1217,72717,77024,08533,59128,170Minorities797372,6888,00710,21411,501Other post-tax income/(expense)-356-1,4100000Net profit9,27611,51726,06434,25146,79458,979DB adjustments (including dilution)520468-1,378000DB

46、Net profit9,79611,98524,68634,25146,79458,979Cash Flow (CNYm)Cash flow from operations-17,44441,25125,596-12,530233,348184,810Net Capex-2,143-1,801-3,115-825-825-825Free cash flow-19,58639,45022,481-13,355232,523183,986Equity raised/(bought back)4,951-3,535-1,2165,99970Dividends paid-4,774-3,005-5,3

47、82-11,988-16,378-20,643Net inc/(dec) in borrowings23,61023,86380,57743,94500Other investing/financing cash flows13,214-8,513-43,939-30,568-7,433-9,379Net cash flow17,41448,26052,521-5,967208,719153,964Change in working capital-22,47735,86010,690-55,613175,515113,505Balance Sheet (CNYm)Cash and other

48、 liquid assets47,87896,491148,402142,435351,154505,118Tangible fixed assets28,70630,65029,96629,96629,96629,966Goodwill/intangible assets122239392392392392Associates/investments3,11019,56457,325120,328119,152119,761Other assets282,141444,627813,5841,087,377995,289765,796Total assets361,956591,5721,0

49、49,6691,380,4971,495,9531,421,032Interest bearing debt89,744136,197214,765258,710258,710258,710Other liabilities182,872373,760718,292936,4721,019,900903,912Total liabilities272,616509,956933,0571,195,1821,278,6101,162,622Shareholders equity84,81970,12893,671121,933152,356190,693Minorities4,52211,487

50、22,94163,38264,98767,718Total shareholders equity89,34081,615116,612185,315217,343258,411Net debt41,86639,70666,363116,275-92,444-246,408Key Company MetricsRunning the numbersRunning the numbersAsia ChinaPropertyCountry Garden HoldingsBuyReuters:2007.HKBloomberg: 2007 HK Price (15Feb19)HKD10.48Count

51、ry Garden HoldingsBuy TargetPriceHKD 17.19 52 WeekrangeHKD 7.89 - 17.28 Company ProfileMarket cap (m)HKDm 226,849 USDm28,907Company ProfileCountry Garden Holdings Company Limited, with over 20 years of development history, is now one of Chinas leading residential property developers focusing on urba

52、nization. Itmainly develops residential properties in T3 cities targeting first- home buyers. As of Dec-2017, the company had a total land bank of 282mn sqm in 220 cities across China.Price Performance20151050Jul 17Jan 18Jul 18Jan 19Margin Trends201816Margin Trends201816141215161718E19E20EEBITDAMarg

53、inEBITMarginGrowth & ProfitibilityGrowth & Profitibility60404030202001015161718E19E20ESalesgrowth(LHS)ROE(RHS)Solvency100500-5019E20E250200150100500Salesgrowth(%)33.946.125.0DB EPSgrowth(%)-7.020.8113.835.737.026.0EBITDAMargin (%)13.614.019.018.717.614.7EBITMargin (%)13.

54、614.019.018.717.614.7Payoutratio (%)30.333.133.035.135.035.0ROE (%)12.814.931.831.834.134.4Capex/sales(%)Net debt/equity (LHS)Net interest cover (RHS)Net debt/equity (%)46.9Net debt/equity (LHS)Net interest cover (RHS)Net debt/equity (%)46.948.756.962.7-42.5-95.4Jeffrey Gao, CFA+85

55、2 2203 6256 HYPERLINK mailto:jeffrey.gao jeffrey.gaoNet interest cover (x)Source: Company data, Deutsche Bank estimates11.919.5nm134.796.9115.8OutlookhaveaBuyratingonCountryGarden.Withmanagementtargetingashiftfocustoqualitygrowthandbusinessdiversication(eg,robotics,agricultural, etc),webelieveattrib

56、utablesaleswillgrowatasingle-digitrateoverthefew years despite the companys large scale. also expect 35% CAGRforFY18-20,giventhestrongsalesgrowthinpastfewyears.ValuationOur target price is based on a 30% discount to our NAV estimate, our assessment of eight measures for the companies we cover (produ

57、ct quality, landbank quality, scale, leverage, growth prospects, protability, nancing advantages and execution). Our end-FY19 NAV estimate per share comprises development properties, investment properties and net cash. NAV estimate values existing landbank and properties based on a parts methodology

58、: 1) we use a DCF to value the companys development properties, with WACC of 11.0% (we apply a risk-free rate of 3.0%, a beta 2.0,ariskpremiumof6.0%andcostofdebtof6.0%);and2)weuseacap-rate approach (cap rate of 5-9%) to value investment properties. In our model,assumefullprepaymentofthelandappreciat

59、iontax.Intermsofpropertyprice assumptions,weassumepriceswilldrop5%y-yinT1/T2/T3citiesin2019remainatthereafter.ThebenchmarkindexforthestockisMSCIChina.RisksMacro risks include: Government property tightening measures that be stricter than expected, unexpected economic uctuations in the economy, and p

60、otential RMB depreciation that may result in FX losses for developerswithoshorenancing.Company-specicrisksinclude:1)than-expectedpropertysalesinlow-tiercitiesduetopolicy/credittightening; and2)inabilitytoacquirequalitylandbanktosustaingrowth.Fiscal year end 31-Dec2015201620172018E2019EFiscal year en