Cultivate the combination of rent and sale of Jinqiao, create a leading industrial urban comprehensive development operator, and maintain the "buy" rating.

Pudong Jinqiao released the 2023 interim report, the company's revenue performance in the first half of the year was higher than the same period last year, the available real estate resources were sufficient, the real estate rental income rose steadily, the rental rate increased against the trend, and the location advantage and industrial agglomeration effect were significant. We maintain the profit forecast and expect the company's net profit from 2023 to 2025 to be 17.84,15.06 and 1.937 billion yuan, corresponding to EPS 1.59,1.34,1.73 yuan, and the current stock price is 8.1,9.6,7.5 times corresponding to PE, maintaining the "buy" rating.

Revenue and profit increased year-on-year, profitability improved

In the first half of the year, the company achieved operating income of 4.845 billion yuan, an increase of 61.0% over the same period last year, and a net profit of 1.512 billion yuan, an increase of 57.8% over the same period last year. Gross profit margin and net profit margin increased to 75.8% and 30.8% respectively (68.6% and 30.7% in 2022). Basic earnings per share is 1.3472 yuan. The high performance of the company is mainly due to the increase in income of 3.832 billion yuan carried over from the second phase of Biyun Zunju project. The net operating cash flow of the company in the first half of the year-6.038 billion yuan, mainly due to the project reserve land expenditure of 5.211 billion yuan.

Hold a large number of high-quality properties and carry out all-round investment business

The company adheres to the business model of leasing and selling at the same time, holding a total of about 3.21 million square meters of all kinds of operating properties, with an average rental rate of 87%, the highest level in recent years. In the first half of the year, the company completed the completion of the Office Park Golden Science Park for the record, increased the leasable area by 199,000 square meters, and promoted the pre-construction or construction of more than 20 projects around the "Golden Central Development Belt". At the same time, the company has started the establishment of a professional investment team, gradually improve the business model of direct investment + fund investment, and carry out investment business in an all-round way.

There are sufficient marketable resources, and the reserve plots in the park continue to be promoted.

The company has sufficient residential projects under construction. In the first half of the year, the company participated in the selection of the implementing main body of the North Bund homestead project in Hongkou District, and was identified as the implementing main body, with an estimated value of more than 7 billion yuan, which will greatly increase the company's land reserve. At the same time, the company's Hong Kong tour project and Zhoupu project are expected to have a sales value of nearly 18 billion yuan, and the project reserve is rich. In terms of park resources, the 08 neighborhood Biyun Commercial complex project continues to promote urban renewal and transfer planning adjustment, which is expected to be formally approved this year; it is initially estimated that the reconstruction and expansion of zero-increase land in Jinqiao South District will add about 400,000 square meters of space.

Risk hint: the project expansion is not as expected, the industrial introduction is not as expected, and the risk of new house price fluctuation in Shanghai.