Event: The company released the 2019 interim results announcement. 2019H1 achieved revenue of 26.62 billion yuan, a year-on-year increase of 86.3%, net profit of 1.98 billion yuan, a year-on-year increase of 29.9%, performance growth in line with expectations, and gross margin is expected to be maintained in the second half of the year. The company's high sales growth in the first three years gradually entered the performance implementation stage. In the first half of the year, the company's settlement regions were mainly located in Hangzhou, Fuzhou, Fuyang, Shanghai, etc., and the sharp increase in settlement amount led to performance growth. The company's gross sales margin for the first half of the year was 23.9%, a slight increase from the end of last year. Looking ahead to the second half of the year, the gross margin is expected to remain around 24%. The sales growth rate has slowed, and the unit sales price is still impressive. In the first half of 2019, the company achieved a sales amount of 56.7 billion yuan (+4%), a sales area of 2.82 million square meters (+11%), and a unit sales price of 20,100 yuan per square meter. It ranked among the top 50 housing enterprises. The sales equity ratio was about 55%, the sales removal rate was about 70%, and the sales repayment rate was about 80%. The company is positioned as a quality real estate developer, focusing on high-efficiency cities, and adhering to the middle and high-end housing market. It is expected to launch 120 billion dollars in the second half of the year (the Yangtze River Delta accounts for 55%, Haixi accounts for 22%). Assuming that the removal rate remains unchanged, the sales target of 140 billion dollars is expected to be achieved throughout the year. The improvement in net debt ratio has exceeded expectations, and safety has improved markedly. In the first half of this year, the company vigorously optimized its debt structure. The share of short-term debt fell from 40% at the end of 2018 to 31% in 2019, the average financing cost fell from 7.1% at the end of 2018 to 6.9%, and monetary capital increased from 25 billion at the end of 2018 to 31.9 billion in mid-2019, an increase of 27.6%. As of mid-2019, the company's net debt ratio was 77%, down 26.8 percentage points from the end of 2018, and the decline exceeded market expectations. Total land reserves grew steadily, and land acquisition remained flexible in the second half of the year. According to the “1 (core tier 1 and 2) +N (surrounding radiation cities)” layout, the company has now entered 43 cities. As of mid-2019, the company has a total land reserve of 26.54 million square meters, an equity ratio of about 53.3%, and an average land cost of 4,465 yuan per square meter, which is equivalent to 22.2% of the average sales price in the first half of this year. In the first half of the year, the company added 4.21 million square meters of land storage (the average premium rate is only 12.6%), the total land consideration was 17.7 billion yuan, and the company's equity land price was 8.4 billion yuan. Land acquisition was relatively cautious, and the company maintained a certain degree of flexibility in land acquisition in the second half of the year. Profit forecast and rating: Combining the valuation of the benchmark company with significant improvements in the company's land storage layout and leverage, the “buy” rating was maintained, with a target price of HK$13.03. Risk warning: Credit or regulatory policies are tightening, sales are falling short of expectations.