The company's sales in Guangzhou continued to gain strength, and the monthly sales volume was in the bottom range. In September 2023, the company achieved sales volume of 9.98 billion yuan in a single month, -40.2% year-on-year, and achieved a sales area of 367,000 square meters, or -26.6% year-on-year. From January to September 2023, the company achieved a cumulative sales amount of 111.93 billion yuan, +40.5% year-on-year, leading the top 100 housing enterprises by 52.8 pct, with a sales area of 3.38 million square meters, +21.6% year-on-year, and a cumulative average sales price of 33,117 yuan/square meter, +15.5% year-on-year. Monthly sales were in the low range of the year.
According to Kerry's data, in January-September, the company's Guangzhou sales amount was 484.79, ranking first, accounting for 43.3% of total sales. The company continues to be deeply involved in the Guangzhou region, and TOD has entered the sales period one after another, helping to achieve the annual sales target of 132.9 billion dollars.
The intensity of land acquisition amounts in the first 9 months was 33.5%, continuing to focus on core cities. In September, the company acquired 1 parcel of land in Xi'an. From January to September '23, the company's total land acquisition amount was 37.48 billion yuan, -28.7%; the cumulative total construction area was increased by 2,961 million square meters, -23.8%; the cumulative equity land price was 22.08 billion yuan, -32.2%; the cumulative land acquisition amount equity ratio was 58.9%, up 5.9 pct from 2022. The intensity of land acquisition in January-September was 33.5%, down 23.1pct from 2022.
Looking at the urban structure of land acquisition, the overall share of land acquisition in Tier 1 and 2 cities increased to 100% in January-September.
Among them, Tier 1 and 2 cities accounted for 63.1% and 36.9% of land acquisition, respectively, an increase of 3.8 pct and a decrease of 3.8 pct over the full year of 2022. Judging from the cumulative land acquisition amount equity ratio, the company's land acquisition equity ratio from January to September was 58.9%, an increase of 5.9 pct over the full year of 2022.
Overseas debt financing is smooth, and the maturity scale is controllable. From January to September '23, the company added 5.4 billion yuan in domestic debt financing, -45.1% year-on-year; overall weighted financing costs were 3.37%, up 0.26% from the full year of 2022.
On the open market side, the company paid off 100,000 million domestic bonds and 400 million US dollars of bonds in October. In 2014, the open market paid off a total of 3.55 billion yuan of domestic debt, so there was less pressure on debt maturing.
Investment advice: With the background of Yuexiu Group and Guangzhou Railway as a dual state-owned enterprise, land acquisition sales have achieved a positive cycle. The company's TOD program maintains high removal and high gross profit advantages. Land acquisition continues to focus on core cities. Domestic and foreign financing channels are unobstructed, three red lines and green lines, and financing costs remain low. Future sales and performance are expected to increase steadily.
Profit forecast: We expect the company's 2023-2025 EPS of 1.15/1.37/1.62 yuan/share, corresponding to PE 7.8/6.6/5.6 times, covering the “buy” rating for the first time.
Risk warning: Demand repair falls short of expectations, project removal is becoming more difficult, and TOD expansion and development fall short of expectations.