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<Research>CICC Expects CN Developers' 2025 Results to Remain Pressured; CHINA RES LAND/ CHINA OVERSEAS/ C&D INTL GROUP Profit Scale Still Considerable
Recommend 13 Positive 17 Negative 9 |
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Within China's real estate sector, the covered companies' earnings in 2025 are expected to continue to decline significantly from that in 2024, according to CICC's research report. Of which, CHINA RES LAND (01109.HK), CHINA OVERSEAS (00688.HK) and C&D INTL GROUP (01908.HK) may record a YoY decline of about 15-20% in 2025 earnings, though their profit levels remained considerable. Firms like GREENTOWN CHINA (03900.HK), YUEXIU PROPERTY (00123.HK), CH OVS G OCEANS (00081.HK), POLY PROPERTY (00119.HK) and SEAZEN HOLDINGS (601155.SH) may record positive profits, albeit marginal. Companies such as LONGFOR GROUP (00960.HK) and URBAN CONS DEV (600266.SH) may incur slight losses, while BINJIANG GP (002244.SZ) and CHINA JINMAO (00817.HK) may see steady and increasing core profits. CICC focused on adjusting the earnings of covered targets for 2025-2026, and kept ratings/ target prices for the 'covered' targets unchanged. A positive stance is maintained on the real estate sector this year. After fully accounting for negative earnings expectations, potential risks identified by CICC may lie in the financial conditions of individual companies. The broker believed that this year may see more positive absolute and relative returns. In terms of stock selection, it is believed that 2026 may be beta-driven, with mainstream targets currently offering good value. Of which, A-shares include BINJIANG GP, SEAZEN HOLDINGS and MERCHANTS SHEKOU (001979.SZ), while Hong Kong stocks include CHINA RES LAND, CHINA OVERSEAS, C&D INTL GROUP, CHINA JINMAO, GREENTOWN CHINA, YUEXIU PROPERTY, CH OVS G OCEANS and POLY PROPERTY. The following table shows CICC's ratings and target prices for Chinese developers: Stock| Rating| TP MERCHANTS SHEKOU (001979.SZ)|Outperform| RMB12.2 BINJIANG GP (002244.SZ)|Outperform| RMB14.25 SEAZEN HOLDINGS (601155.SH)|Outperform| RMB18.5 CHINA RES LAND (01109.HK)|Outperform| $44.63 CHINA OVERSEAS (00688.HK)|Outperform| $17.2 C&D INTL GROUP (01908.HK)|Outperform| $19.1 CHINA JINMAO (00817.HK)|Outperform| $1.86 GREENTOWN CHINA (03900.HK)|Outperform| $11.88 YUEXIU PROPERTY (00123.HK)|Outperform| $6.75 CH OVS G OCEANS (00081.HK)|Outperform| $3.29 POLY PROPERTY (00119.HK)|Outperform| $2.65 AASTOCKS Financial News Website: www.aastocks.com |
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