The business performance grows at a high speed and passes through the cycle steadily. In the first half of 2023, the company achieved operating income of 24359.2 million yuan, + 43.7% compared with the same period in 2022. Among them, the company's property development business income of 22743.5 million yuan, accounting for about 93.37% of the total revenue. As of June 30, 2023, the company's gross profit and return net profit were 3714.4 yuan and 1284.1 yuan respectively, which were + 45.6% and + 52.5% respectively compared with the same period last year; the gross profit margin and home net profit rate were 15.2% and 5.3% respectively, maintaining a stable level; basic income per share was 0.80 yuan per share, which was + 33% compared with the same period last year. In the first half of 2023, the total construction area of the property delivered by the company was about 1.8 million square meters, an increase of about 1.06 million square meters over the same period in 22 years.
Sales refresh target performance and maintain a leading position in the industry. In the first half of 2023, the company realized the subscription amount of 98.8 billion yuan, + 39% compared with the same period last year; the full-caliber contract amount and the rights and interests contract amount were 94.1 billion yuan and 74.7 billion yuan respectively, + 43% and + 56% respectively compared with the same period last year, and the proportion of sales rights and interests was 79%. The proportion of sales rights and interests continues to increase. As of June 30, 2023, the total floor area of the company's equity sales was 3.338 million square meters, compared with the same period in 2022 + 34.4%. In terms of repayment, the company achieved a rebate of 97.9 billion yuan in the first half of 2023, with a payback rate of 104%, which has been maintained at a high level of about 95% in recent years.
Continuous layout of hot areas, soil storage re-optimization. As of June 30, 2023, the company has 298 projects in China and the total saleable floor area of the land reserve is about 17.11 million square meters. In the first half of 2023, the company continued to increase its investment in Shanghai, Xiamen, Hangzhou and hot cities, adding 46 cases of high-quality land, with full-caliber land holding amount and full-caliber land holding value of 68.4 billion yuan and 129.5 billion yuan respectively, with first-and second-tier cities accounting for 86%.
Good liquidity, financial safety and health. As of June 30, 2023, the company had 60,739 million yuan in cash on hand, + 69.8% compared with the same period last year; the total amount of borrowing was about 8905 million yuan within one year, and about 80142 million yuan had to be repaid within one year but within five years, and there were no interest-bearing loans denominated in Hong Kong dollars; the net debt-to-equity ratio was about 32.01%, down 20.6 percentage points from 52.59% at the end of 2022 Total assets and net asset value (excluding non-controlling interests) were 469741 million yuan and 32706 million yuan respectively, + 18.7% and + 26.6% respectively compared with the same period last year. We believe that the company's financing policy is prudent, the cash flow is sufficient to maintain a good capital structure, and the overall financial safety and health.
Investment advice. Maintain the "better than the market" rating. Considering the excellent background of Jianfa International parent company, the sound development of various types of business, and the further release of land value in the future, we predict that the company's EPS in 2023 will be 2.97 yuan, giving the company a valuation of 8-10 times PE in 2023, corresponding to a market capitalization range of HK $479-59.9 billion and a reasonable value range of HK $25.96-32.45 per share. (unless otherwise noted in this article, they are all denominated in RMB, HK $1 = RMB0.92).
Risk tips: 1) the total growth rate of new housing in the real estate industry has the risk of shrinking; 2) the market repair is not as expected.