Introduction to this report:
In March 2024, the sales performance of the company's development business was consistent with the industry. Although the year-on-year decline continued, the decline narrowed, and the investment attitude towards land acquisition remained cautious; the cumulative year-on-year growth rate of operating revenue widened slightly again, and the overall growth rate was steady, moderate and positive.
Summary:
The company released operating data for March 2020. The sales performance of the development business is beginning to improve, while the non-development business remains steady and maintains an increase in holdings rating. In the first quarter of 2024, the company's sales volume was 23.5 billion yuan (RMB, same below), down 54% year on year, down 40% and 35% from the third quarter of 2023 and the fourth quarter of 2023, respectively. Among them, the year-on-year decline narrowed in March 2024, and there was an initial marginal improvement. Maintain the company's 2024-2026 EPS at 1.93 yuan, 1.97 yuan, and 2.07 yuan, and maintain the shareholding rating.
The company's sales performance recovered marginally in March. The decline in sales area was 9 pcts narrower than in January-February, which is basically in line with industry performance. In March 2024, in terms of absolute scale, the company's sales area was 730,000 square meters, and the sales amount was 10.7 billion yuan, ranking 9th in Lexerui's full-caliber sales volume list, and its position in the industry was stable. Judging from the year-on-year growth rate, sales area and sales amount fell 39% and 52% year-on-year respectively. The decline was 9 pct and 3 pct narrower than in January-February, respectively, and marginal improvements began to appear slightly.
In addition, the average monthly sales price in March was 14,605 yuan/square meter, down 22% and 3% from year to month, respectively, which is comparable to the average price level for the whole of 2016.
The company added 1 new land reserve in Foshan. The land investment intensity in March was 8%. In March, the company obtained the Foshan Amusement Park plot with a land area of 20,000 square meters and a total construction area of 80,000 square meters. The equity ratio is 100%, the total price is about 600 million yuan, and the average unit price is 7,669 yuan/square meter. This is the first time since 2020 that the company has added new land reserves in Foshan. By the end of 2023, the company still had 180,000 square meters of land reserves in Foshan, accounting for 0.4% of the total reserves. In terms of the investment intensity of land acquisition, the company's current investment intensity is only 8% in a single month, which is less than the full year of 2023 (23%).
The cumulative year-on-year growth rate of operating revenue continued to expand slightly, and the non-development business was steady, moderate and positive. In the first quarter of 2024, operating revenue reached 6.4 billion yuan (excluding tax, same below), up 10% year on year. The increase was 2 pcts wider than in January-February. Of these, operating revenue was 3.4 billion yuan, accounting for 53%, and service revenue was 3 billion yuan, accounting for 47%. It is expected that as the scale of the non-development business continues to expand, its share of profit contribution will continue to increase, further helping the company to stabilize profits and return to growth.
Risk warning: The decline in demand exceeded expectations, and the development of other transformation businesses fell short of expectations