Gemdale Group (600383): Low Valuation Leader with Positive Growth in Sales and Positive Financial Security
Recent situation of the company We have recently investigated the fundamental situation of the company. Comments will reach 2000 trillion at the earliest, and raw materials will increase by 20% in 2020.On January 1, 2019, the company achieved contracted sales / sale area of 1,751 trillion / 8.96 million square meters, an increase of 31% and 26%, respectively, and the corresponding average sales price increased by 4% to 19,546 yuan / square meter.We expect the company’s annual budget to grow by 23% to 2000 trillion per year.Looking ahead, we expect the company to achieve a profit of US $ 240 billion next year, which is equivalent to an increase of 20%. The amount of land taken increased and the price decreased, and the proportion of equity rose.From January to November, the company’s new land reserve was 10.36 million square meters, an increase of 53% year-on-year, and the total land price was US $ 65.8 billion, a continuous decline of 11%.32% (59% in the same period last year).The company ‘s new soil reserve equity ratio (amount caliber) in 1H19 rose to 54%, reaching a new high of nearly four years (2015?(2018 is 38% / 42% / 47% / 40%). At present, the company’s unsold soil reserves are nearly 40 million square meters. We expect the company to continue to actively acquire land next year, and the proportion of land acquisition equity will continue to rise.We estimate that the company’s unsold soil storage gross margin is about 30%?35%, a high level in the industry. The financial side is stable and financing costs remain low.At 杭州桑拿网 the end of the third quarter, the company’s net debt ratio fell by 10 percentage points to 68% from the intermediate report, which is at a nominal level in the industry; cash in hand covers interest-bearing liabilities due within one year.8 times, high cash security.We expect that the company will still be able to control its net debt ratio below 80% while continuing to grow strongly on the land.The company started this year with three.2% of the cost issuance of a 3 billion ultra short-term financing to 5.6% and 6.0% cost to issue two USD debt financings5.$ 500 million.The company’s current average financing cost4.8%?4.9%, maintaining the industry’s low level. Initially extended high dividends and high dividend yields.We expect the company to maintain a dividend ratio of about 35% this year and next, corresponding to a dividend yield of 5/2019 / 2020e.4% / 6.2%, significantly higher than the average level of A-share housing companies we cover4.3% / 5.The 0% estimate suggests that considering the company’s steady sales growth, active land acquisition and improved equity ratio, we raise our 2019/2020 profit forecast by 1% and 3% to 2.17/2.59 yuan / share, raise target price by 4% to 16.83 yuan, maintain outperform industry rating.The company is currently leading the trade at 6.4/5.4 times 2019/2020 price-earnings ratio, lower than the average level of A-share housing enterprises (7.7/6.4 times), the new target price corresponds to 7.8/6.5x 2019/2020 target price-earnings ratio and 21% upside. Risks are mainly laid out Tighter than expected urban land planning policies.