It is proposed to repurchase shares through centralized bidding transactions. The central enterprise background strengthens investment confidence and maintains the “buy” rating. On October 16, 2024, China Merchants Shekou Co., Ltd. issued an announcement announcing that it will repurchase the company's shares through centralized bidding transactions using its own funds or self-raised funds through the Shenzhen Stock Exchange trading system. All shares repurchased this time will be cancelled and the company's registered capital reduced. The company's overall business performance is steady, sales rankings are at the top, and open market land acquisition is active. The repurchase of shares will further stabilize investors' positive expectations for the company's continued operation. We maintain our profit forecast. We expect the company's 2024-2026 net profit to be 6.39, 7.03, 7.44 billion yuan, EPS 0.71, 0.78, and 0.82 yuan. The PE corresponding to the current stock price is 16.2, 14.7, and 13.9 times, maintaining a “buy” rating.

Management's repurchase proposal; shareholders have no plans to reduce their holdings

China Merchants Shekou announced that based on confidence in future development, in order to enhance investor confidence, stabilize and enhance the company's value, China Merchants Shekou will repurchase the company's shares through centralized bidding transactions. The price of the repurchased shares will not exceed RMB 15.68 per share, and the repurchase amount will not be less than RMB 0.351 billion and not more than RMB 0.702 billion. The source of funding is the company's own capital or self-financing, and the repurchase period is within 12 months from the date of approval by the shareholders' meeting. The estimated number of repurchases is about 44.7704 million shares (0.49%) to 22.3852 million shares (0.25%). After the repurchase, the share of shares with limited conditions of sale and shares with unlimited conditions of sale changed slightly, but the total number of shares decreased, and the repurchases will not have a significant impact on the company's operations, profitability, finance, etc. Mr. Jiang Tiefeng, the chairman of the company, proposed a repurchase on October 13, 2024. The relevant shareholders did not have a clear plan to increase or decrease their holdings during the repurchase period. After the shares are repurchased, the company will carry out legal procedures such as notifying creditors, etc., and will completely cancel and reduce the registered capital.

Investment promotion department's collective buyback, central enterprise background strengthens investment confidence

Since October 14, a number of listed companies in the “Investment Promotion Department” have collectively announced plans to increase their holdings or repurchase plans. Among them, 6 companies announced repurchase plans, namely China Merchants Shipping, China Merchants Savings, China Merchants Highway, China Merchants Shekou, China Merchants Port and Sinotrans; 3 companies issued announcements to increase their holdings, namely Sinotrans, China Southern Petroleum, and Liaogang shares, respectively. The shareholders of China Merchants listed companies are China Merchants Group. The total assets are huge, providing great assistance to the company's continued operation and financing. This time, the CMB company's collective share repurchase is conducive to consolidating investors' confidence and enhancing the capital market's positive expectations for the company's steady operation.

Risk warning: Market recovery falls short of expectations, housing price regulation exceeds expectations, diversified business operations fall short of expectations.