20180321-兴业金融证券-华润置地-01109.HK-Broad-Based_Growth_Story_Remains_Intact_13页_567kb
报告摘要
China Resources Land Summary
Core Content
China Resources Land (CRL) is a leading property developer in China, with a strong financial position and a broad-based growth strategy. The company is part of the China Resources Group, which holds a 61.3% stake. It is listed on the Hong Kong Stock Exchange (HKEx) and has been a constituent of the Hang Seng Index since 2010.
Main Points
- Performance Outlook: CRL's contracted sales performance is expected to improve in 2Q/3Q18F, with the potential to exceed its conservative FY18F target of CNY183bn. The company is projected to achieve a contracted sales growth at a CAGR of 25% from FY17 to FY20.
- Earnings and Dividends: CRL's FY17 recurring net profit rose 17.7% YoY, beating forecasts by 5.2%. The company also announced a higher-than-expected final dividend of HKD0.867/share, with total dividends for FY17 up 37.4% YoY. The dividend payout ratio reached 35% in FY17, up from 30% in FY16.
- Financial Position: CRL maintains a defensive balance sheet with a net gearing of 35.9% in FY17, expected to stay within 30-40% in FY18-20. Its weighted average borrowing cost is projected to remain at 4-4.5%, which is one of the lowest in the industry.
- Valuation: The target price for CRL is updated to HKD31.50, reflecting a 25% discount to its end-FY18F ENAV of HKD42.00. This represents a 10% upside from the current price of HKD28.60. The company's valuation metrics show a declining P/B ratio from 1.70 in Dec-16 to 0.97 in Dec-20F, while the P/E ratio continues to decrease, indicating a potential undervaluation.
- Growth Drivers: CRL's growth is supported by a large landbank (total saleable resources of CNY600bn), a quality investment property portfolio, and a strong sell-through rate (expected to reach 70% in FY18F). These factors contribute to a steady CAGR in earnings and revenue.
Key Information
Financial Forecasts and Valuations
| Metric | Dec-16 | Dec-17 | Dec-18F | Dec-19F | Dec-20F |
|---|---|---|---|---|---|
| Total Turnover (HKDm) | 109,328 | 118,588 | 165,317 | 223,622 | 280,254 |
| Recurring Net Profit (HKDm) | 16,274 | 19,156 | 24,447 | 28,432 | 31,874 |
| Recurring EPS (HKD) | 2.35 | 2.76 | 3.52 | 4.09 | 4.59 |
| DPS (HKD) | 0.70 | 0.97 | 0.95 | 1.11 | 1.24 |
| Recurring P/E (x) | 12.2 | 10.3 | 8.1 | 7.0 | 6.2 |
| P/B (x) | 1.70 | 1.38 | 1.23 | 1.09 | 0.97 |
| Dividend Yield (%) | 2.5 | 3.4 | 3.3 | 3.9 | 4.3 |
| Net Debt to Equity (%) | 23.8 | 35.7 | 29.7 | 33.8 | 40.6 |
Key Metrics
| Metric | Dec-16 | Dec-17 | Dec-18F | Dec-19F | Dec-20F |
|---|---|---|---|---|---|
| Revenue Growth (%) | 5.2 | 8.5 | 39.4 | 35.3 | 25.3 |
| Recurring EPS Growth (%) | 11.1 | 17.7 | 27.5 | 16.2 | 12.0 |
| Gross Margin (%) | 33.7 | 40.3 | 39.5 | 37.1 | 34.7 |
| Net Profit Margin (%) | 17.8 | 19.4 | 14.8 | 12.7 | 11.4 |
| Dividend Payout Ratio (%) | 25.0 | 29.1 | 27.0 | 27.0 | 27.0 |
Earnings Forecast Changes
- Recurring Net Profit is expected to grow at a CAGR of 17.7% from FY17 to FY20, with a 27.6% growth in FY18F.
- Gross Profit is projected to increase significantly, with a 31% growth in FY18F and 46% in FY19F.
- Net Interest and Exceptional Income are expected to fluctuate, with net interest income decreasing in FY18F and exceptional income dropping to zero in the future.
- EBITDA is forecasted to grow at a CAGR of 33.9% for booked sales revenue and 13.9% for rental income.
Landbank and Investment Portfolio
- CRL has a substantial landbank with a total GFA of 50m sqm as of end-2017.
- The company's landbank includes development properties and investment properties, totaling CNY310bn in saleable resources.
- The ENAV for FY18F is estimated at HKD42.00, with a 25% discount to the target price of HKD31.50.
Risk Factors
- Tightening Measures in Tier-1 Cities: Especially in Shenzhen, this could pose a risk to sales and profitability.
- Market Conditions: Any downturn in the real estate market could affect the company's performance.
Recommendation
- Investment Recommendation: Maintain a BUY rating.
- Target Price: Updated to HKD31.50, representing a 10% upside from the current price of HKD28.60.
- Share Performance: The share price has seen a 24% YTD rally, suggesting potential profit-taking as a buying opportunity for the 6-12 month investment horizon.
- Share Data: The company has a free float of 39%, with an average daily turnover of 522m HKD. The 52-week price range is between HKD20.1 and HKD32.4.
Peer Comparison
| Company | Stock Code | Price (HKD) | Mkt Cap (USDm) | 3-mth Avg T/O (USDm) | RHB/Cons (USDm) | Discount (%) | P/E (FY17F) | P/E (FY18F) | EPS YoY Change (FY17F) | EPS YoY Change (FY18F) | 3-yr EPS CAGR | P/BV (FY17F) | P/BV (FY18F) | Div Yield (FY17F) | Div Yield (FY18F) |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Large Peer Average | - | - | - | - | - | 23.4 | 23.4 | 10.1 | 7.7 | 41.4 | 57.7 | 2.2 | 2.3 | 2.7 | 9.1 |
| Evergrande | 3333 HK | 25.40 | 42,660 | 73.1 | 43.50 | 41.6 | 13.5 | 8.6 | 57.7 | 24.6 | 6.8 | 1.2 | 1.1 | 3.1 | 3.6 |
| China Overseas | 688 HK | 27.80 | 38,828 | 87.9 | 35.70 | 22.1 | 9.1 | 8.5 | 6.8 | 15.8 | 6.8 | 1.2 | 1.1 | 3.1 | 3.6 |
| China Vanke | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
Conclusion
China Resources Land remains a top pick among big-cap developers, with a strong financial position, a robust landbank, and a quality investment portfolio. Despite the risks associated with tightening measures in Tier-1 cities, the company's performance and valuation suggest a strong investment case. The updated target price of HKD31.50 and the positive earnings outlook support the BUY recommendation.
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