Settlement and gross profit margin declined, gradually implementing the security transition strategy, the company released its quarterly report on April 29th, and 2024Q1 achieved revenue of 615.Crashtwinsanityps3.900 million yuan (YOY-10Crashtwinsanityps3.1%), the net profit returned to the mother is-360 million yuan (YOY-125.0%). We maintain the profit forecast of 0.72 EPS 0.78max 0.82 yuan respectively from 2024 to 2026, A shares (000002 CH) refer to the comparable company's average PE average 11.1x (Wind) in 2024, considering that the company's diversified assets are expected to be revalued, we will give 12xPE in 2024 with a target price of 8.64 yuan (the previous value is 10.08 yuan) and maintain the "overweight" rating. With reference to the average discount rate of 43% in the past six months, H shares (2202HK) are given a discount of 43% and a target price of HK $5.35 (the previous value is HK $6.03), maintaining the "overweight" rating. The decline in settlement income and development gross profit margin led to losses, and revenue from operating services business increased by-22.8% of the completed area of 24Q1 compared with the same period last year, fulfilling 12.0% of the full-year plan. The settlement area / settlement income is then-26.7% 6.7pct 13.8% compared with the same period last year, and the settlement gross profit margin is 10.5% compared with the same period last year, as the high land price projects obtained in the past 21 years have entered the settlement process.Crashtwinsanityps3Because of his rigid expenditure, he suffered a net loss from homing, and it is expected that the development and settlement profits will still face challenges this year. Affected by the weak prosperity of the industry, the sales scale has further shrunk. The sales amount is 58 billion yuan, which is-42.8% compared with the same period last year. The front-end investment is prudent, with only 3 pieces of land in January during the period, with a total of 930 million of the land obtained by rights and interests, and the new construction is-71.2% compared with the same period last year. By the end of the period, the land reserve was-19% compared with the same period last year. The development business as a whole shrank, while the operating services business increased by 12.0% compared with the same period last year. The pressure on short-term debt has increased, and the strategic focus of the security transition has gradually put pressure on the company's short-term debt. Compared with the end of 2023, the cash short-term debt is further reduced by 56pct to 1.0, and the net debt ratio is + 11pct to 54.7% compared with the same period last year. The company said in the annual report that this year's strategic focus is security transition, mainly from three aspects: 1. Ensure the bottom line of security: revive the stock through bulk trading and other means, 24-year transaction rebate of not less than 30 billion, 2024Q1 has achieved 4.2 billion; 2. Reduce leverage: reduce interest-paying debt by 100 billion in 24-25 years; 3. Adhere to the sustainable and endogenous development of the development business. During the period, the company also carried out organizational adjustment and focused on optimizing management resources. 2024Q2-Q4 maturing public debt of about 22.4 billion, actively invigorating the stock is expected to ease the pressure on the company's cash flow. Real estate revitalization, major shareholders and policy support to help the company smoothly through the winter the company is rich in real estate resources. On April 8, the company successfully sold CICC India consumption infrastructure REIT, with a net fund-raising of 3.26 billion yuan. At the same time, Huaxia Wanwei warehousing REITs also entered the declaration, raising about 1.16 billion of the initial public offering, and the rental housing REIT is also in progress, helping the company's stock to revive. Major shareholders also support the company: Shenzhen Railway Group subscribesCrashtwinsanityps3CICC print Power REIT 29.75% share. In the policy, it is repeatedly mentioned that housing enterprises of different ownership should be treated equally, which is also a support for the company. Both the operating property loan policy and the urban financing coordination mechanism can form financial support for the company. with the help of many parties, the company increased its financing cost by 3.33% during the period, a decrease of 28bp compared with 2023. Risk tips: industry sales downside risk, real estate enterprise credit risk. [disclaimer] this article only represents the views of a third party and does not represent the position of Hexun. Investors operate accordingly, at their own risk.

[disclaimer] this article only represents the views of a third party and does not represent the position of Hexun. Investors operate accordingly, at their own risk.