Huafa (600325): Performance in line with expected sales

Huafa (600325): Performance in line with expected sales

The company’s performance on January 3, 19 was in line with our expectations. The company’s performance on January 3, 19: operating income of $ 19.4 billion, an increase of 48%; net profit attributable to mothers, an increase of 7%, corresponding to zero diluted income.

82 yuan, in line with expectations.

Revenue increased by nearly 50%, and gross profit margin continued its upward trend.

The company’s operating income in the first three quarters increased by 48% each year (mainly due to the expansion of the settlement scale, the completion area increased by 37% in ten years).

The company’s gross profit margin after tax in the third quarter was 26%, continuing the upward trend of gross profit margin in the first half of the year (24% / 19% in 2018 / 1H19 respectively), driving the gross profit margin after tax in the first three quarters to increase by 5 to 25% compared to the same period last year.

Affected by the high base of investment income in the first half of last year, net profit attributable to mothers increased by 3% semi-annually in the first half of the year, but increased by 26% in the third quarter.

.

Net operating cash flow increased significantly, and the net debt ratio dropped slightly.

The company’s net operating cash flow in the first three quarters increased by 102% to US $ 19.2 billion each year. At the end of the period, the company’s monetary funds increased by 33% to US $ 25.4 billion, and its net debt ratio decreased to 262% (269% / 270% at the end of 2018 / 1H19).).
The development trend has doubled, with a cumulative total of over 80 billion US dollars a year, an annual increase of 37%.

In the first three quarters, the company achieved a contract value of 61 billion yuan / 403 million square meters, an increase of 51% / 68% each year, and the corresponding average sales price gradually decreased by 10% to 23019 yuan / square meter.

The newly-started area in the initial period increased by 98% annually, which is expected to provide strong support for the sales end.

We expect the company’s budget to exceed 80 billion (corresponding to a 37% ten-year growth rate).

Land acquisition is accelerating, and the fourth quarter is expected to continue to actively acquire land.

The company’s new equity soil reserves in the third quarter increased by 69% per year, and gradually increased by 62% per year in the first three quarters.

We 杭州桑拿 estimate that the company’s ending saleable value exceeds 3000 trillion, equivalent to 3.
.

8 times.

With the decline in the land market temperature in the fourth quarter, we expect the company to continue to actively acquire land.

Earnings forecasts and estimates remain unchanged from 2019/2020 earnings forecasts. The company currently expects to trade at 5.

6/4.

5x 2019/2020 forecast P / E ratio and 46% NAV discount.

Maintain outperform industry rating and raise target price by 5% to 9.

RMB 37 (mainly due to increased market risk appetite and improved cash flow of the company), corresponding to 6.

8/5.

5x 2019/2020 target price-earnings ratio and 33% discount on NAV, which is 23 compared with the current one.

0% upside.

The risk financing environment tightened more than expected; the key layout city planning 无锡桑拿网 policy tightened more than expected;