Core net profit to the mother grew steadily, and gross margin declined slightly. The company achieved total revenue of RMB 10.423 billion, a slight increase of 10.7% over the same period last year. Among them, revenue from property sales amounted to RMB 10.066 billion, accounting for 96.6%. The company achieved net profit attributable to shareholders of RMB 1,917 billion, down 5.12% year on year; net profit from core business to mother was RMB 1,544 billion, up 28.9% year on year; net interest rate was 18.4%, down 3.1 percentage points from the same period last year. Signed sales in January-July amounted to 42.217 billion yuan, an increase of 68% over the previous year. From January to July 2019, the company achieved a cumulative contract sales amount of RMB 42.217 billion, an increase of 68% over the previous year; achieved a contracted sales area of 3.392 million square meters, an increase of 73% over the previous year; and the average sales price was 12,446 yuan/square meter, down 3% year on year. Sales in the first half of 2019 were divided according to city levels. First-tier, second-tier, third-tier and fourth-tier accounts for 17.5%, 41.9%, and 40.6%, respectively. Focus on core regions and actively expand land reserves. In the first half of 2019, the company added 27 new projects, including Beijing, Tianjin, Chongqing, Hangzhou, Jinan, Nanchang, Foshan and Kunming. The total land cost is about RMB 24.034 billion, the company's land cost is approximately RMB 14.438 billion, and the total floor area that can be built is about 5.27 million square meters. As of the first half of 2019, the company and its joint ventures and joint ventures had a total planned construction area of 29.01 million square meters, and the company should occupy a total planned construction area of 16.32 million square meters, distributed in 37 cities. According to the city level, the proportion of first tier, second tier, third tier and fourth tier was 17.5%, 41.9%, and 40.6% respectively. The net debt ratio declined slightly, and the debt structure was optimized. As of the first half of 2019, the company's balance ratio was 80.39%, up 2.39 percentage points from the same period last year; the company's net debt ratio was 66.2%, down 3.0 percentage points from the same period last year, and the overall net debt ratio was at the lowest level in the industry. As of the first half of 2019, short-term debt only accounted for 22.7% of total debt, and short-term debt only accounted for 39.0% of cash and bank deposit balances. The company's capital liquidity was very abundant. Investment advice: Maintain an “better than the market” rating. Since 2019, the company's contract sales volume has increased dramatically, and land investment has also been very effective. The land reserve layout of urban clusters accounts for 77.7% of the first and second tier. The debt structure has gradually been optimized, the share of long-term debt has increased, and the overall operation is improving. We expect the company's 2019 and 2020 EPS to be RMB 0.88 and RMB 1.09 respectively. As of August 23, 2019, the company closed at HK$4.08 (RMB 3.68), corresponding to PE 4.19 times and 3.38 times in 2019 and 2020, respectively, and the corresponding PEG value in '19 was only 0.28. We gave the company 5-6XPE in 2019, with a reasonable value range of HK$4.87-5.85 (RMB 4.40-5.27), maintaining a “superior to market” rating. Full text 1 RMB = HK$1.1088. Risk warning: The company's sales progress falls short of expectations; the industry faces downward fundamental risks.