1. Incident Overview Rongsheng Development announced the sales situation in August. In August, it achieved a contract area of 927,800 square meters, an increase of 19.93% over the previous year; the contract amount was 10.236 billion yuan, an increase of 31.26% over the previous year. From January to August 2020, the company achieved a total contract area of 5.9687 million square meters, an increase of 5.52% over the previous year; the cumulative contract amount was 66.202 billion yuan, an increase of 8.25% over the previous year. 2. Analysis and judgment that the sales growth rate increased month by month. The average transaction price increased month on month. Since April of this year, the company's sales growth rate has continued to increase. The cumulative sales growth rates for January-April, January-May, January-June, January-July, and January-August were -9.47%, 3.18%, 3.54%, 4.89%, and 8.25%, respectively; furthermore, the average transaction price increased significantly this year. The average sales price increase in August was 11033 yuan/square meter, +9.45% year over year, showing that the improvement of the company's land reserve structure achieved good results. . The soil storage structure continues to improve, and regions outside Beijing are actively expanding. In the first half of this year, the company continued to optimize the land reserve structure. It successively obtained 45 plots of land in 22 cities in the Beijing-Tianjin-Hebei, Yangtze River Delta, and Midwest regions, with a planned construction area of 4.6743 million square meters. By the end of the reporting period, the company's land reserves had a construction area of 40.36 million square meters, with an estimated value of more than 400 billion yuan. In August, the company further developed reserves in Anhui and Hunan through tenders, and maintained a positive trend in expanding beyond Beijing. The increase in financing-side capacity was significantly accompanied by the introduction of financing-side talent, and the company's financing capacity continued to improve. Following the successful development of overseas financing last year, additional credit financing reached 33 billion yuan in the first half of the year, completing 63% of the annual financing plan (only 45% in the same period last year), and the main rating was raised to AAA. At the end of mid-2020, the net debt ratio was 93.7%. Although it was a slight increase from the end of last year, the level was within the red line (100%). The dividend rate is stable. The dividend rate is close to 6%. The company's 2019 dividend amount was 2,087 billion yuan, and the dividend rate reached 23%, corresponding to the current stock price dividend rate of close to 6%. 3. Investment Proposals The company's operation is steady, reserves are sufficient, and sales have improved significantly; the company's current valuation already contains overly pessimistic expectations. The company's earnings per share for 20-22 are 2.65, 3.11, and 3.62 yuan, corresponding to PE of only 3.1, 2.6, and 2.3 times. The current valuation level is the lowest since listing, maintaining a “recommended” rating. 4. Risk Alerts: 1. Real estate policy regulation was tightened beyond expectations; 2. Peripheral risk uncertainty increased.