The results turned a loss into a profit, and repayment control was good. The company achieved operating income of 20.36 billion yuan, a year-on-year decrease of 17.1%, mainly due to a decrease in carry-over revenue from the company's main real estate industry, which realized net profit of 550 million yuan to mother, turning a loss into a profit. The company has plenty of cash on hand, with monetary capital of 13.69 billion yuan at the end of the period, net operating cash flow of 13.12 billion yuan, an increase of 57.3% over the previous year, and good repayment control. The issuance of 4.5 billion yuan of corporate bonds was completed in 3 installments throughout the year, and interest rates were superior to the same period in the market.
Sales bucked the trend, and core cities bucked the trend and expanded land storage. In 2023, the company achieved a sales area of 735,000 square meters, an increase of 41.6% over the previous year; sales volume was 32.6 billion yuan, an increase of 7.4% over the previous year. It ranked second among Beijing real estate companies for 3 consecutive years, and was ranked among the top 50 listed real estate companies in China. Several projects achieved popularity during the period. Tiantanfu was the first high-end project in Beijing to sell more than 10 billion yuan on a single disc for two consecutive years. Starlight BEIJING ranked first in Beijing in the second half of the year in terms of the number of online signings. The company bucked the trend and added 822,000 square meters of total land reserve construction area, of which 567,900 square meters of equity area. The company's soil storage quality is high. By the end of 2023, the company has 25 projects to be developed, with a total planned construction area of 2.13 million square meters, of which the Beijing project accounts for 35% of the area and Huangshan accounts for 50% of the area.
Diversified businesses are developed collaboratively, and the strategic layout is being advanced in depth. 1) Commercial real estate: At the end of the period, the company's commercial real estate holding area was 464,000 square meters, and the commercial real estate turnover was 650 million yuan. The company's first self-operated project city, Yuehui, was grandly opened. 2) Cultural tourism real estate: The overall operation structure and operation plan of the Huangshan project were deepened, the first batch of residences were successfully opened, and a hotel entrustment management agreement was signed; Yunmeng Mountain Scenic Area continues to enrich tourism products. 3) Shed reform: Various projects such as Wangtan relocation housing and riverside housing progressed smoothly during the period. As of the end of 2023, the company had 11 first-level land development and shed renovation projects. The projects under construction and early stages had a planned construction area of 7.72 million square meters, with a total investment of about 106.5 billion yuan. Of these, only 1 project was located in Baoding City, Hebei Province, and the remaining 10 projects were all located in Beijing.
Profit forecast and investment advice: The compound growth rate of net profit to mother is expected to be 38.5% in 2024-2026. Considering that the company is deeply involved in core cities, sales have bucked the trend, and the soil storage is sufficient and of high quality, the company was given 0.4 times PB, and the target price was 4.56 yuan, maintaining the “buy” rating.
Risk warning: completion delivery or falling short of expectations, land acquisition and sales repayment or falling short of expectations, real estate regulation risk, risk of changes in the fair value of financial assets, etc.