Incident: The company announced its 2023 results. The company achieved operating income of 23 billion yuan in 2025.2 billion yuan, +12.3% year over year; net profit to mother of 25.61 billion yuan, +10.1% year over year; basic income per share of 2.34 yuan/share, +10.1% year over year.
Double digit growth in revenue and profit,
The company achieved operating income of 23 billion yuan in 2025.2 billion, +12.3% year on year; net profit to mother was 25.61 billion yuan, +10.1% year over year.
Revenue and profit have maintained a double-digit growth trend, showing the undertone of high-quality leaders under industry fluctuations. The company's gross profit margin for 23 years was 20.32%, down 0.97 pct from the same period in '22; the company's net profit margin for '23 was 13.35%, down 0.27 pct from the same period in '22; and the company's net operating cash inflow was 35.28 billion yuan. The Board of Directors recommended a final dividend of HK45 cents per share, along with an interim dividend of HK$35 per share. A total dividend of HK$80 per share will be distributed throughout the year to positively return shareholders.
Sales bucked the trend, and the volume advantage was obvious
On the sales side, the company's contract property sales were 309.81 billion yuan, +5.1% year over year, and sales area was 13.36 million square meters, -3.7% year over year.
According to Kerry's statistics, equity sales of the group's series companies rose to second place in the industry. Among them, core Tier 1 and 2 cities, such as Beijing, Shanghai, Guangzhou, and Shenzhen, had ideal sales repayments, all exceeding 10 billion yuan. On the land acquisition side, the company added 43 new land plots in '23, adding a total land storage area of 7.64 million square meters and an equity construction area of 7.06 million square meters, with an equity ratio of 92.4%; total land price of 134.21 billion yuan, investment intensity of 43.3%; equity land price was 122.66 billion yuan, +42.0% year-on-year. The company's equity interest in the four first-tier cities of Beijing, Guangshen and Shenzhen accounts for about 60% of the land purchase amount, and the cargo volume structure advantages are outstanding. The company closely tracks related mergers and acquisitions, and obtained all remaining shares in the Guangzhou Asian Games City project and 17% shares in the Suzhou Huanxiuhu Garden Project in the year 23.
Leading the financing industry, optimized debt structure
Judging from financial indicators, the company's overall financial situation in '23 was ideal. The net debt ratio and other related indicators fell below the three red line standards, making it a “green” enterprise. As of the end of '23, the company's net current assets were $368.95 billion, with a current ratio of 2.3 times, a net loan ratio of 38.7%; bank balances and cash of $105.63 billion. The company's weighted average financing cost during the year was 3.55%, and financing costs were in the lowest range in the industry. Looking at the debt structure, the company raised 82.91 billion yuan domestically and abroad in '23, repaid 98.49 billion yuan of debt early or due, and net repayment of debt of 15.58 billion yuan. Overseas withdrawal loans of 25.14 billion yuan and domestic low-interest loans of 48.58 billion yuan in 2012. Overall, interest-bearing loans declined, and various capital costs were effectively controlled. Corporate banks and other loans amounted to $165.30 billion, guaranteed notes and corporate bonds amounted to $92.36 billion, with a total loan of $257.66 billion; of this, loans maturing within one year amounted to RMB 40.97 billion, accounting for 15.9%.
Commercial operations have maintained high growth, and asset-light businesses are developing rapidly
In '23, the company achieved commercial property revenue of 6.36 billion yuan, an increase of 20.9% over the previous year, including office buildings, shopping malls, long-term rental apartments, hotels and other commercial properties of 3.43, 16.8, 190, and 1.06 billion yuan. In '23, the company put 12 new commercial properties into operation, increasing the total construction area by about 1.05 million square meters, and signed new contracts to manage six external commercial properties during the year. By the end of '23, the company had managed a total of 1.5 million square meters of external commercial properties. The smooth entry of new projects into the market and the rapid development of the asset-light management business contributed to the growth of commercial property revenue.
Investment advice: The company's performance bucked the trend, showing the undertone of the leading position. The overall operation is steady, the financial indicators are impressive, the land storage layout focuses on core cities, and there is plenty of momentum to buck the trend. Considering the expansion of the industry and the intensification of competition, we adjusted the company's net profit to mother for 24-25 to be 28.254 billion yuan and 32.245 billion yuan (previous value of 29.945 billion yuan and 32,576 billion yuan), respectively, to maintain the “buy” rating.
Risk warning: business development falls short of expectations, uncertainty in business operation, uncertainty in policy regulation