Short-term performance is under pressure and settlement is facing bottlenecks: 1) in the past 15 years, the performance declined compared with the same period last year, with revenue of 829.72 million yuan, down 56.15% from the same period last year; and the net profit attributed to shareholders of listed companies was 78.55 million yuan, down 1.38% from the same period last year. The company is faced with problems such as the decline of elimination and the lack of settling resources in the short term. 2) stable gross profit, slight decline in ROE, and sufficient monetary funds: the company's gross profit margin is 51.5%, which is basically the same as the previous year. ROE of 5.2% is slightly conducive to 5.6% of the millennium, and the cash on hand at the end of the period is about 1.64 billion yuan.

Deep ploughing and slow expansion, millions of reserves to seek development: 1) the company is based in Beijing, strategically expand the city, divest the business of Inner Mongolia, and lay out Beijing, Yinchuan, Tianjin and Dalian. Resource endowment is better; 2) millions of reserves seek development: as a small and medium-sized real estate company, the company has 974000 square meters of land reserves, including 226000 square meters of salable area and 489000 square meters of land to be developed.

Jingneng Coal has tried to inject into the company: 1) the major shareholder is Jingneng Group, a wholly owned enterprise of Beijing State-owned assets Supervision and Administration Commission, with four listed companies with assets of 220 billion, annual revenue of about 60 billion and annual profit of nearly 6 billion. The group realizes the "two-wheel" drive of asset operation and capital operation. 2) the free transfer of Beijing Coal Group to Jingneng Group: in December 2014, the Beijing State-owned assets Supervision and Administration Commission transferred Beijing Coal Group to Jingneng Group free of charge, resulting in a combination of coal and power enterprises in Beijing and a great increase in resource endowment. 2) the reorganization failed because of the excessive amount of assets: in July 15, in order to solve the problem of inter-industry competition, the company's controlling shareholder Jingneng Group intends to inject the relevant real estate assets after the merger of Jingneng Beijing Coal into the listed company, but in view of the large amount of related assets, large format and wide geographical distribution, the major asset reorganization work will be suspended temporarily, and the relevant work will be started again when the conditions are ripe. It has been 10 months since the last restructuring.

The reform of state-owned enterprises may benefit, and regional integration helps development: 1) the reform of state-owned enterprises has attracted attention, and the establishment of a state-owned assets reform fund may benefit: Jingneng property as a real estate listing platform under the State-owned assets Supervision and Administration Commission, asset integration is expected. 2) the division of functional areas in the capital and the Beijing-Tianjin-Hebei region may contribute to the development of the company: the company ploughs deeply and carefully in Beijing, and has the Beijing Sihe Upper House project in Beijing. At the same time, with the relocation and closure of the industry of Beijing Coal Group, the self-land use will also greatly enhance the company's land reserve in Beijing. Jintai Real Estate of the former Beijing Coal Group has nearly 1.8 million square meters of high-quality land reserves.

Investment suggestion: the company's real estate business is based on Beijing Shengeng Sicheng, with an equity reserve of 970000 square. After the merger of Jingneng Beijing Coal, the major shareholder competes for a reserve of about 1.8 million square, which needs to be solved urgently in the future. The company's short-term performance is under pressure but the cash on hand is as high as 1.64 billion yuan, and the asset safety margin is high. We estimate that the company's EPS for 2016-2018 will be 0.20,0.24,0.29, and the corresponding stock price PE will be 41x, 34x, 27x. It covers the "Buy-A" rating for the first time, with a 6-month target price of 12.0 yuan.

Risk hint: sales progress is lower than expected and integration expectations fail.