20221031-招银国际-龙湖集团-00960.HK-Wu_s_retirement__short-term_pain_for_long-term_gain_4页_787kb

报告摘要

Longfor (960 HK) Summary

Core Content

Longfor, a leading property developer in China, has announced a major management change with the retirement of its founder, Ms. Wu Yajun, and the promotion of Mr. Chen Xuping to Chairman. This transition is expected to create short-term volatility due to Ms. Wu's status as an industry icon, but the company is positioned to benefit in the long term.

Main Points

Management Change:
- Ms. Wu Yajun has resigned from her Chairlady position, and Mr. Chen Xuping has been promoted to Chairman.
- Mr. Shao will transition from an executive director to a non-executive director.
- This change is part of a long-term 10-year plan to build a sustainable corporate culture.
Short-term Impact:
- The resignation may cause some short-term volatility.
- The current price is HK$13.12, with a target price of HK$52.59, suggesting a potential upside of 300%.
Long-term Outlook:
- Longfor is expected to be one of the few Property Owners' Enterprises (POEs) to survive the current downturn.
- Sales have turned positive YoY in Q3, with October sales likely to improve further.
- The company plans to redeem most of its 1H23 debts by the end of 2022, including USD300mn offshore debt.
- The management team (Mr. Chen, Shao, and Zhao) is expected to continue executing the C1-C5 strategy, targeting RMB25bn in revenue from segments C2-C5 this year and RMB100bn in the long term.
Financing Strategy:
- Longfor is looking to open up new financing channels using its shopping malls as collateral.
- With an IP value of RMB180bn and a low LTV of 20%, the company may secure RMB36bn in additional debt.
Sales and Land Acquisition:
- The company has continued to acquire land in September and October, with NPM in the range of 13-15%.
- It has exited over 30 cities and is focusing on 30 core cities.

Key Financial Information

Earnings Outlook

2022 Net Profit (NP): Expected to remain flat or slightly increase.
2022 Revenue Growth: Estimated to be 15-20% YoY.
Operating Income (C2–C5 segments): Expected to reach RMB25bn this year.
Long-term Revenue Target: RMB100bn.

Share Performance

Current Price: HK$13.12
Target Price: HK$52.59
12-mth Price Performance: -7.3% (Absolute), -6.3% (Relative)

Shareholding Structure

Cai Xinyi: 42.7%
Cai Kui: 23.3%
Pao Puiying: 7.0%
Free float: 27.0%

Market Capitalization

Mkt Cap (HK$ mn): 217,769
Avg 3 mths t/o (HK$ mn): 318.76
52w High/Low (HK$): 53.60 / 34.20

Key Ratios

Sales Mix:
- Property development: 93.9% (FY22E)
- Property investment: 5.6%
- Property management: 4.7%
Profit Margins:
- Gross margin: 32.3%
- Pre-tax margin: 27.0%
- Net margin: 13.4%
Balance Sheet Ratios:
- Net gearing ratio: 57.0%
- Current ratio: 1.5x
- Receivable day: 54.8
- Payable day: 120.2
- Inventory day: 889.8
Return Ratios:
- ROE: 22.3%
- ROA: 14.3%

Financial Summary

Income Statement

Revenue: RMB233,116 (FY22E)
Net profit: RMB31,237 (FY22E)
EPS (RMB): 5.22 (FY22E)

Cash Flow

Net cash from operating: RMB14,335 (FY22E)
Net cash from investing: RMB-13,106 (FY22E)
Net cash from financing: RMB4,645 (FY22E)

Balance Sheet

Cash at the end: RMB42,068 (FY22E)
Total equity: RMB211,694 (FY22E)
Borrowings: RMB15,200 (FY22E)

CMBIGM Ratings

BUY: Potential return of over 15% over next 12 months.
Target Price: HK$52.59.

Analyst Certification

The analyst certifies that the views expressed reflect personal opinions and are not influenced by compensation.
The analyst has not traded in the stock covered in this report within 30 days prior to the report's issue and will not do so within 3 business days after.

Important Disclosures

The report is not investment advice and is based on public information.
CMBIGM is not liable for any loss or damage resulting from reliance on the report.
The report is intended for specific investors and may not be distributed to others without consent.
The report may be subject to change and is for the use of intended recipients only.

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