Carefully edited by CITIC research newspaper: steadily expand the area, quality creates value

Summary:China's property management industry is in a stage of rapid development, residents' pursuit of quality of life, and the diversification of property company services, jointly promote the growth of the leading companies in this industry.

1. The listed property management platform of China Shipping Group.

The company was founded in Hong Kong in 1986 and entered the mainland to carry out property management services in 1991. In 2015, the company was spun off from Chinese overseas groups and listed on the Stock Exchange by introduction.The company ranks 11th in the comprehensive ranking of Chinese property service enterprises in 2018.

2. Market pattern: the development space of the property management industry is broad, the industry concentration is increasing rapidly, and the high-quality leader is growing rapidly.

China's property management industry is in the stage of rapid development. The basic charge of property management in China is low, and the medium-and long-term high-quality services are expected to be reasonably priced. Property management companies may become an important platform for providing life services. In 2017, the average management area of the top 100 enterprises reached 3163.83 million square meters, an increase of 16.1 percent over the same period last year, and the market share continued to increase to 32.42 percent, an increase of 2.98 percent over 2016.

3. Business characteristics: relying on the advantages of shareholders to steadily increase the management area.

The source of the company's area under management is China Overseas Land & Investment and his affiliated companies. As of May 2018, the company has a total of 672 projects, with a management area of 131 million square meters (public information on the company's website), with a compound growth rate of about 31.5% from 2014 to 2017.At present, the company has entered a total of 73 cities, among which the Pearl River Delta and the Yangtze River Delta are the key areas of the company.

4. Future highlights: the scale of value-added services is still small, but the space is not small.

The value-added services sector achieved operating income of HK $263 million in 2017, accounting for less than 10 per cent of total revenue, and its gross profit margin was significantly higher than that of its peers, reaching 53.9 per cent. Value-added services are divided into two parts, one is to provide automation consulting and engineering product sales services for developers, and the other is to provide life-related online and offline services for owners through the O2O platform. The company takes Youjia app and Youyou interconnected Wechat platform as the core to create an "excellent +" Internet ecosystem.