Bank of America Merrill Lynch said that after the 2014/2015 fiscal year contract sales fell 20% year-on-year, the management of South China City (2.27, -0.18, -7.35%) (01668.HK) was cautious about the 2015/2016 sales target and is expected to remain flat from year to year, at 11 billion yuan to 12 billion yuan. Since the local government is still slow to demolish the old wholesale markets in the relevant cities, and the number of saleable projects in South China City is still limited, it is expected that in the next phase of the Group's contract sales momentum will stabilize at the current level. The bank lowered its 2016/2017 earnings forecast by 22%/25%, and its net asset value forecast was lowered by 11% to reflect extended sales and a higher net debt ratio. The target price was raised from 40% to 45% compared to net asset value, and the target price was reduced by 18% to 3.7 yuan. The rating remains “buy”.