The data during the National Day period was excellent. The amount of land acquired by first-tier cities during the year was nearly 70%, and while maintaining the “buy” rating, Poly Development released a business report for September 2024. The company's sales industry ranking remained number one. The amount of land acquired by first-tier cities during the year was nearly 70%, and the data performance during the National Day was excellent. We maintain our profit forecast. We expect the company's net profit to be 13.2, 14.25, and 15.16 billion yuan, respectively, and EPS of 1.10, 1.19, and 1.27 yuan respectively. The current stock price corresponds to PE valuations of 9.0, 8.3, and 7.8 times, respectively, to maintain a “buy” rating.

The sales ranking remained number one, and the average cumulative project price increased year-on-year

In September 2024, the company signed a contract amount of 20.916 billion yuan, a year-on-year decrease of 41.93%; the contract area was 1.2498 million square meters, a year-on-year decrease of 36.36%. From January to September 2024, the company achieved a contract amount of 241.686 billion yuan, a year-on-year decrease of 27.89%; it achieved a contract area of 13.4962 million square meters, a year-on-year decrease of 29.66%. In September 2024, the average sales price of the company's projects was 16735.48 yuan/square meter, down 8.75% year on year; from January to September 2024, the cumulative sales unit price of the company's projects was 17907.71 yuan/square meter, up 2.51% year on year. According to Kerry data, from January to September 2024, the company ranked first in the industry in full-caliber sales.

Four parcels of land were acquired in a single month. The amount of land acquired by first-tier cities during the year was nearly 70%. In September 2024, the company obtained 4 parcels of land in the form of tenders. The total land acquisition price was 13.75 billion yuan, the total construction area was 0.5755 million square meters, and the average floor unit price was 23,899 yuan/square meter. The first plot is located in Tianhe District, Guangzhou, with a construction area of 0.1756 million square meters and a land acquisition cost of 11.755 billion yuan; the second plot is located in Duanzhou District, Zhaoqing City, with a construction area of 0.112 million square meters and a land acquisition cost of 0.959 billion yuan; the third plot is located in Qiaoxi District, Shijiazhuang City, with a construction area of 0.1044 million square meters and a land acquisition cost of 0.959 billion yuan; the fourth plot is located in Heping Street, Changchun City, with a construction area of 0.1835 One million square meters, the land acquisition cost is 0.74 billion yuan. The company acquired 24 land cases in January-September, with a total construction area of 2.23 million square meters, corresponding to land payments of 39.72 billion yuan, a year-on-year decrease of 65.9% and 63.3%, respectively. The intensity of land acquisition was 18.0% (36.2% for the same period in 2023), accounting for 69.0% of the land acquisition amount in first-tier cities.

The data performance during the National Day was excellent. The multi-line business was successfully repaired. During the 2024 National Day, the company achieved more than 0.1 million customer visits in batches, with a cumulative turnover of 26 billion yuan. The passenger flow of the Poly Business Travel project managed by Poly increased 17% year on year, and sales increased 13% year on year; the occupancy rate of the managed hotel project increased 5.7% year on year, and the number of new members increased by 42% year on year; the number of passengers serviced by Poly Properties during the National Day exceeded 2 million.

Risk warning: Industry recovery falls short of expectations, policy relaxation falls short of expectations, and company sales recovery falls short of expectations.