2 HK Equity CLP Holdings Ltd 80 202,116 15.77 15.21 1.99 3 ... · 2016. The ASP for most projects has improved. For 2H17, the focus of contracted sales will be on (1) TODTOWN, a project

1

Yum Cha 飲茶 September 26, 2017

TALKING POINT - DEFENSIVE STOCKS AMID MARKET VOLATILITY

Source: Bloomberg

INDICES Closing DoD%

Hang Seng Index

27,500.3

(1.4)

HSCEI

10,912.5

(1.8)

Shanghai COMP

3,341.5

(0.3)

Shenzhen COMP

1,963.9

(1.2)

Gold

1,308.5

(0.2)

BDIY

1,502.0

2.2

Crude Oil, WTI(US$/BBL)

52.1

(0.2)

Crude Oil, BRENT(US$/BBL)

59.0

3.8

HIBOR, 3-M

0.8

(0.4)

SHIBOR, 3-M

4.4

(0.1)

RMB/USD

6.6

0.5

DATA RELEASES DUE THIS WEEK

Sept 26 Industrial Profits YoY

Sept 27 Swift Global Payments CNY

Sept 27 BoP Current Account Balance

Sept 28 Caixin China PMI Mfg

Sept 29 Manufacturing PMI

Sept 29 Non-Manufacturing PMI

Market was more volatile yesterday because of tighter policies on the China property market and increasing political tension around the Korean peninsula. Given the upcoming national holiday in China, we expect the trading volume of the Hong Kong market will drop because of the temporary suspension of the Stock Connect (no southbound trading from Sep 28 and it will resume on Oct 9). Therefore we updated the list of low beta stocks from investors’ reference. In general, stocks like PCCW (0008.HK), HKT Trust (6823.HK), VTech (0303.HK), MTRC (0066.HK) and Hopewell Highway (0737.HK) should be more defensive based on their relatively high dividend yield.

HSI stocks

Ticker Company name

Price

(HK$)

Market cap

(HK$m)

2017E

PER (x)

2018E

PER (x) PBR (x)

2017E

dividend

yield (%)

3-month average

daily turnover

(HK$) BETA

1038 HK Equity CK Infrastructure Holdings Ltd 67.45 178,788 16.18 15.05 1.81 3.55 133,405,200 0.49

8 HK Equity PCCW Ltd 4.22 32,577 15.57 15.57 1.68 6.78 34,278,560 0.55

2 HK Equity CLP Holdings Ltd 80 202,116 15.77 15.21 1.99 3.61 177,193,600 0.60

66 HK Equity MTR Corp Ltd 45.4 272,508 27.30 28.11 1.76 6.54 169,953,800 0.61

6 HK Equity Power Assets Holdings Ltd 67.4 143,849 19.09 18.34 1.33 4.04 269,563,300 0.63

Other mid caps

Ticker Company name

Price

(HK$)

Market cap

(HK$m)

2017E

PER (x)

2018E

PER (x) PBR (x)

2017E

dividend

yield (%)

3-month average

daily turnover

(HK$) BETA

303 HK Equity VTech Holdings Ltd 108.2 27,198 15.77 14.70 5.95 6.11 29,526,590 0.42

6823 HK Equity HKT Trust & HKT Ltd 9.43 71,402 14.29 13.77 1.83 6.80 99,170,270 0.45

345 HK Equity Vitasoy International Holdings Ltd 17.34 18,289 33.03 29.14 7.38 1.86 11,007,690 0.48

737 HK Equity Hopewell Highway Infrastructure Ltd 4.81 14,823 20.91 19.89 2.31 4.66 9,343,471 0.53

341 HK Equity Cafe de Coral Holdings Ltd 24.3 14,226 25.50 23.14 4.08 3.29 11,256,590 0.55

659 HK Equity NWS Holdings Ltd 15.58 60,615 12.91 11.80 1.31 3.87 19,336,710 0.68

Source: Bloomberg

Analyst: Wong Chi-man, CFA

RESEARCH NOTES

SIUD [0563.HK; HK$1.74; NOT RATED] - Despite recent tightening of the market, Shanghai Industrial Urban Development (SIUD) is likely to maintain stable revenue booking and contracted sales in 2017 and 2018 as the Company has carefully planned its project launches. As a local SOE, SIUD enjoyed low land costs in Shanghai, and we expect projects such as TODTOWN to contribute visible earnings ahead. The Company has been a laggard in the sector, as it is trading at a price-to-book ratio (PBR) of just 0.66, or a 62% discount to our NAV estimate of HK$4.57/share. We also expect the restructuring with its sister company, Shanghai Industrial Development [600748.CH, NOT RATED], to continue to be a potential catalyst.

1

COMPANY UPDATE

Analyst: Tony Li, CFA ([email protected]; Tel: (852) 3698 6392 )

Shanghai Industrial Urban Development [0563.HK, HK$1.74, NOT RATED] –

A laggard in the China property sector with valuable assets in Shanghai

Market Cap: US$1,071m; Free Float: 28.7%

Shanghai Industrial Urban Development [0563.HK, NOT RATED] Summary. Despite recent tightening of the market, Shanghai Industrial

Urban Development (SIUD) is likely to maintain stable revenue booking and

contracted sales in 2017 and 2018 as the Company has carefully planned its

project launches. As a local SOE, SIUD enjoyed low land costs in Shanghai,

and we expect projects such as TODTOWN to contribute visible earnings

ahead. The Company has been a laggard in the sector, as it is trading at a

price-to-book ratio (PBR) of just 0.66, or a 62% discount to our NAV

estimate of HK$4.57/share. We also expect the restructuring with its sister

company, Shanghai Industrial Development [600748.CH, NOT RATED], to

continue to be a potential catalyst.

Company. SIUD is a property developer in mainland China, with 20 real

estate projects in 10 major cities: Shanghai, Kunshan, Wuxi, Beijing,

Shenyang, Tianjin, Xi’an, Chongqing, Changsha, Fuzhou and Shenzhen.

Shanghai Industrial Holdings is the parent company of SIUD after an

acquisition in 2010, and it currently holds a 71.01% stake. Most projects

developed by SIUD are mid- to high-end residential projects.

Core Earnings in 1H 2017 Greatly Improved. Due to the delivery of

Shanghai projects such as Urban Cradle and Grand Mansion, SIUD

recorded strong revenue growth of 71.8% YoY to RMB4.2bn in 1H 2017. As

the projects in Shanghai can be sold at a GPM of up to 50%, SIUD’s overall

gross profit margin in 1H17 was 50.04% (1H16: 33.6%).

Therefore, SIUD’s core earnings improved significantly in 1H17, even

though headline profit attributable to shareholders increased only 3.4% YoY

to HK$322.8m. In 1H16, SIUD recorded a HK$1,114m disposal gain, as it

sold its interest in Shanghai U Center. When this huge disposal gain and fair

value gain of HK$47.5m are excluded, SIUD reported much smaller core

earnings in 1H16. In FY2017, core earnings are expected to be stronger

thanks to (1) stronger revenue booking, (2) lower interest costs, and (3)

lower FX loss due to the foreign currency translation effect from RMB.

2017’s sales target of RMB9.3bn should be achievable. In 1H17, SIUD’s

contracted sales grew 2.5% YoY to RMB4,645m, achieving 50% of the

annual sales target (before considering attributable amount) of

RMB9,300m. Projects in Shanghai (Urban Cradle and Shanghai Grand

Mansion) accounted for 50.9% of the contracted sales value during the

period, while the Xi’an Originally project accounted for 29.1% of the value.

According to the Company, Shanghai sales have been doing well even

under stricter purchase restrictions and regulations in the city since Oct

2016. The ASP for most projects has improved.

For 2H17, the focus of contracted sales will be on (1) TODTOWN, a project

co-developed with Sun Hung Kai Properties in Shanghai; and (2) the Fuzhou

Sweet Sea World Project. However, since SIUD’s stake in these projects is

less than 50% (20.7% for TODTOWN and 26% for Sweet Sea World), the

contribution from these projects will be through “share of gain of associates”

when the projects are delivered and booked.

Low gearing and finance costs supportive to land bank replenishment.

SIUD’s net gearing fell to 6.5% as at the end of 30 June 2017, down from

8.1% at the end of 2016. The weighted-average finance cost also fell to

4.20% in 1H 2017, thanks to its status as an SOE. Management believes

there is plenty of room to replenish its land bank given this favourable

funding position.

Source: Bloomberg

Sept 26, 2017

In the near term, a net gearing ratio of 60-70% could be accepted by

the Company, and in this case, SIUD may be able to comfortably

borrow more than RMB6bn to fund its land acquisitions. The

Company repaid all foreign currency dominated debt in 2016, so the

FX risk exposure is much lower in 2017. However, given the rising

onshore funding costs and dropping offshore costs, it is now

reconsidering the option of offshore funding.

Exploring opportunities in key cities and with its parent. Like

other developers, SIUD aims to acquire more land in Tier 1 and

strong Tier 2 cities, with Shanghai the primary focus. In Aug 2017,

the Company won the bid for a land plot for office and commercial

use with a GFA of 118,000 sq.m. in Minhang District, Shanghai, for a

consideration of RMB2.22bn (or RMB18,644/sqm). While

management says the Company will be careful in selecting projects

to acquire, it is also exploring possibilities for primary development

with its parent SIIC. Older factories or hospitals owned by the SIIC

Group may have potential for urban renewal, and SIUD could

leverage its strength and relationship with the Shanghai government.

(continue on next page)

HKD 2015 2016 2017E 2018E

Revenue (m) 3,872 5,491 7,035 8,500

COGS (m) (2,620) (4,090) (4,643) (5,619)

Gross profit (m) 1,252 1,401 2,392 2,882

Gross margin (%) 32 26 34 34

EBIT (m) 2,125 3,295 n.a. n.a.

Net profit (m) 517 522 549 586

Net margin (%) 13 10 8 7

EPS 0.11 0.11 0.11 0.12

ROE (%) 4.14 4.20 4.70 5.10

Dividend yield (%) 0.7 0.80 2.07 2.24

PER (x) 16.2 16.0 15.8 14.5

PBR (x) 0.7 0.7 0.7 0.6

2

COMPANY UPDATE




Restructuring delayed, but SIUD should have an advantage. The restructuring of the two real estate platforms under the umbrella of Shanghai Industrial Holding [363.HK, NOT RATED], namely SIUD and Shanghai Industrial Development [600748.CH, NOT RATED], has been a major catalyst for these three companies. Originally, Shanghai Industrial Holding planned to resolve the internal competition by 2017. However, it was postponed to 2019. Despite the obstacles, SIUD management still feels the restructuring is workable; the exact steps of the restructuring process will be up to the parent company and SASAC.

Valuation. Despite the recent rally of mainland property developers, SIUD has been a laggard in the sector with a YTD return of -6.9%. We believe this is mainly for two reasons: (1) its high concentration of assets in Shanghai, which is tightly regulated, and (2) its reliance on asset disposals to smooth out earnings in the past.

Having said that, as of 25 Sept 2017, the Company is trading at a PBR of 0.66, or a 62% discount to our NAV estimate of HK$4.57/share. At this valuation, the Company should be trading in the lower range of comparable companies. Further catalysts for a re-rating of the Company may include (1) a relaxation of regulations in major cities after the CCP Congress in October 2017, (2) stronger-than-expected contracted sales in 2H17, and (3) positive progress in the intra-group restructuring.

Figure 1: NAV Breakdown of the Company

Sept 26, 2017

NAV Value per % of

HKD'000 Share (HKD) GAV

Development Properties

Shanghai 6,814,168 1.42 28.4%

Rest of China 8,835,611 1.84 36.8%

Total 15,649,780 3.25

Investment Properties

Shanghai 6,570,295 1.37 27.4%

Rest of China 1,758,992 0.37 7.3%

Total 8,329,286 1.73

GAV 23,979,066 4.98 100.0%

Net Debt (2,010,000) (0.42)

NAV 21,969,066 4.57

Share Price as at 25 Sep 2017 1.74

Discount to NAV 61.9%

Assumptions:

Risk-free rate: 3.60%

Beta 1.35

Equity Risk Premium 7.80%

Cost of Debt 5.00%

Tax 25.00%

Weight of Debt 63.10%

WACC 7.58%

Sources: Company, CGIS Research estimates

3

COMPANY UPDATE




Figure 2: Revenue Booked by the Company (by Project)

Figure 3: Contracted Sales Breakdown

Sept 26, 2017

Project CityAmount

(HK$ m)

% of

total

revenue

GFA

(sq.m.)

% of total

GFA

ASP

(HKD/sq.m.)

1H 2017

Grand Mansion (part of Shanghai Jing City) Shanghai 1,862 49.1% 47,153 34.9% 39,478

Urban Cradle Shanghai 1,343 35.4% 29,134 21.6% 46,095

Originally Xi'an 426 11.2% 49,391 36.6% 8,632

Urban Development International Centre Wuxi 96 2.5% 5,238 3.9% 18,375

Shanghai Youth City Shanghai 26 0.7% 1,132 0.8% 23,120

Others 37 1.0% 3,029 2.2% 12,155

Total 3,790 100.0% 135,077 100.0%

1H 2016


Shanghai Jing City Shanghai 420 21.0% 23,142 22.4% 18,148

Royal Villa Kunshan 308 15.4% 42,896 41.5% 7,180

Urban Development International Center Wuxi 171 8.5% 7,195 7.0% 23,767

Originally Xi'an 57 2.8% 6,081 5.9% 9,373

Youngman Point Beijing 10 0.5% 561 0.5% 17,825

Others 16 0.8% 2,073 2.0%

Total 2,002 100.0% 103,411 100.0% 19,360

Project City

Amount

(RMB

m)

% of

total

sales

GFA

(sq.m.)

% of total

GFA

ASP

(RMB/sq.m.)

1H 2017


Originally Xi'an 1,596 29.1% 173,330 14.1% 7,787

Grand Mansion (part of Shanghai Jing City) Shanghai 380 19.0% 13,999 29.0% 63,075

Lao Chengxiang Tianjin 272 5.1% 6,359 5.0% 37,248

Forest Sea Changsha 226 3.1% 31,722 17.0% 4,527

Shenyang•U Center Shenyang 101 1.1% 5,136 3.0% 9,897

Others 109 0.7% 2,803 11.0% 11,927

Total 4,631 100.0% 274,364 100.0%

1H 2016

Grand Mansion (part of Shanghai Jing City) Shanghai 1,849 40.8% 40,905 20.9% 45,212


Originally Xi'an 380 8.4% 56,726 29.0% 6,694

Lao Chengxiang Tianjin 272 6.0% 9,655 4.9% 28,123

Royal Villa Kunshan 226 5.0% 34,151 17.4% 6,615

Urban Development International Center Wuxi 101 2.2% 6,163 3.1% 16,433

Others 109 2.4% 20,670 10.6%

Total 4,533 100.0% 195,818 100.0% 23,150

Sources: Company, CGIS Research


4

COMPANY UPDATE




Figure 4: Major Investment Properties of the Company (as at 30 June 2017)

Figure 5: Projects and Lank Bank of SIUD (as at 30 June 2017)

Sept 26, 2017



CitySite Area

(sq.m.)

Planned

GFA

(sq.m.)

Saleable

GFA

(sq.m.)

1H2017

GFA pre–

sold

(sq.m.)

Accumulated

GFA Sold

(sq.m.)

Future

saleable

GFA

(sq.m.)

Saleable

GFA under

construction

(sq.m.)

Saleable GFA

for future

development

(sq.m.)

Expected

completion date

Ownership

(%)

Property Development

Urban Cradle 萬源城 Shanghai 908,950 1,136,468 822,724 25,202 763,513 59,211 38,749 - 2007–2017, in phases 53.10%

Binjiang U Center 濱江城開中心 Shanghai 77,371 525,888 324,600 - - 324,600 65,900 258,700 2019–2021, in phases 35.40%

Shanghai Youth City 上海青年城 Shanghai 57,944 212,130 164,688 - 139,840 24,848 - - Completed 100.00%

Shanghai Jing City 上海晶城 Shanghai 301,908 772,885 609,488 13,999 558,969 50,519 37,133 - 2012–2018, in phases 59.00%

TODTOWN TODTOWN天薈 Shanghai 117,825 605,000 385,300 - - 385,300 272,300 113,000 2018–2022, in phases 20.70%

Contemporary Art

Villas當代藝墅 Shanghai 116,308 71,822 71,822 - 31,705 40,117 - 6,000 2018–2020, in phases 100.00%

Contemporary

Splendour Villas當代美墅 Shanghai 120,512 111,562 71,500 - - 71,500 - 71,500 2018–2020, in phases 100.00%

American Rock 後現代城 Beijing 121,499 523,833 454,610 - 454,563 47 - - Completed 100.00%

Youngman Point 青年匯 Beijing 112,700 348,664 295,114 770 259,113 36,001 13,693 - 2007–2021, in phases 100.00%

West Diaoyutai 西釣魚台嘉園 Beijing 42,541 250,930 230,801 - 172,069 58,732 - 49,288 2007–2021, in phases 90.00%

Laochengxiang 老城廂 Tianjin 244,252 752,883 613,357 6,359 578,266 35,091 29,795 - 2006–2019, in phases 100.00%

Yoooou.net 遊站 Kunshan 34,223 129,498 112,812 346 62,297 50,515 - - Completed 30.70%

Royal Villa 琨城帝景園 Kunshan 205,017 267,701 222,666 515 204,857 17,809 - - 2007–2017, in phases 53.10%

Urban Development

International Centre上海中心城開國際 Wuxi 24,041 193,368 143,862 1,172 41,937 101,925 - - Completed 59.00%

Originally 自然界 Xi'an 2,101,967 3,899,867 3,202,324 173,330 2,175,673 1,026,651 21,580 789,706 2008–2019, in phases 71.50%

Sub-total 4,587,058 9,802,499 7,725,668 221,693 5,442,802 2,282,866 479,150 1,288,194

Property Development / Current Investment Property

Shenyang•U Center 瀋陽城開中心 Shenyang 22,651 228,768 176,315 5,136 10,634 165,681 176,315 - 2015–2018, in phases 80.00%

Top City 城上城 Chongqing 120,014 786,233 616,122 - 376,095 240,027 - - Completed 100.00%

Forest Sea 森林海 Changsha 679,620 1,032,534 1,016,765 28,776 299,039 717,726 63,672 704,553 2007–2025, in phases 67.00%

China Phoenix Tower 中國鳳凰大廈 Shenzhen 11,038 106,190 79,391 - 78,343 1,048 - - Completed 91.00%

Sweet Sea World 香海世界 Fuzhou 387,693 1,046,898 806,808 156,627 277,036 529,772 536,700 270,108 2018–2021, in phases 26.00%

Sub-total 1,221,016 3,200,623 2,695,401 190,539 1,041,147 1,654,254 776,687 974,661

Total 5,808,074 13,003,122 10,421,069 412,232 6,483,949 3,937,120 1,255,837 2,262,855

Project

City Type Stake Planned GFA (sq.m.)

Youngman Point 青年匯 Beijing Commercial 100% 19,768

Top City 城上城 Chongqing Commercial and car park 100% 251,847

China Phoenix Tower 鳳凰大廈 Shenzhen Office 91% 1,048

Shanghai Youth City 上海青年城 Shanghai Commercial 100% 16,349

Contemporary Art Villas 當代藝墅 Shanghai Villa 100% 43,976

ShanghaiMart 上海世貿商城 Shanghai Exhibition, trade market, office and car park 51% 284,651

Urban Development International Tower 城開國際大廈 Shanghai Office 59% 45,239

YOYO Tower (formerly known as Huimin

Commercial Tower)

城開YOYO

(匯民商廈)Shanghai Commercial 59% 13,839

OthersShanghai

and TianjinCommercial, office and car park 59% 9,249

685,966

Project

5

COMPANY UPDATE




Figure 6: Breakdown of Future Saleable GFA by Cities

Figure 7: Interim Results in 2016 and 2017

Sept 26, 2017

1H 2016 1H 2017

HK$'000 HK$'000 YoY Change

Revenue 2,456,815 4,221,912 71.84%

Cost of sales (1,631,817) (2,108,952) 29.24%

Gross profit 824,998 2,112,960 156.12%

Other income 150,509 119,085 -20.88%

Other expenses, gains and losses, net (226,042) 4,105 N/A

Fair value changes on investment 47,523 (48,927) N/A

Distribution and selling expenses (88,359) (144,311) 63.32%

General and administrative expenses (219,217) (187,963) -14.26%

Gain on disposal of assets through a subsidiary 1,114,163 0 -100.00%

Finance costs (337,754) (306,908) -9.13%

Share of gains (losses) of associates 945 951 0.63%

Profit before tax 1,266,766 1,548,992 22.28%

Income tax (533,933) (823,035) 54.15% - PRC Enterprise Income Tax (EIT) 374,054 159,045 -57.48%

- PRC Land Appreciation Tax (LAT) 190,704 496,240 160.21%

- PRC Withholding Tax 0 18,095 N/A

Profit for the period 732,833 725,957 -0.94%

Profit for the period attributable

– Owners of the Company 312,101 322,751 3.41%

– Non-controlling interests 420,732 403,206 -4.17%

EPS (HK cents) 6.49 6.74 3.85%

Shenyang5%

Chongqing6%

Changsha18%

Beijing2%

Fuzhou14%

Shanghai25%

Xi'an26%

Others5%



6

COMPANY UPDATE




Figure 8: Peer Comparison

Sept 26, 2017

Sources: Bloomberg, Capital IQ, CGIS Research estimates for SIUD’s NAV

Ticker Name Price Mkt Cap

HKD (HKD Bil) F Y16 F Y17E F Y18E F Y16 F Y17E F Y18E F Y16 F Y17E F Y16 F Y17E H K$ P remium / D isc

563 HK Equity SIUD 1.74 8.37 15.72 15.82 14.50 0.66 0.66 0.64 4.24 4.70 0.74 2.07 4.54 -61.7%

Large-Mid Cap

3333 HK Equity China Evergrande Group 26.90 353.29 61.22 10.63 8.89 7.06 4.27 3.31 10.69 40.70 0.00 2.97 28.42 -5.3%

2202 HK Equity China Vanke Co Ltd 24.80 332.38 11.06 8.90 7.50 2.04 1.77 1.53 19.68 21.12 4.99 4.64 32.83 -24.5%

688 HK Equity China Overseas Land & Investme 25.45 278.84 7.01 7.79 6.84 1.15 1.11 0.99 17.52 15.32 3.75 3.43 37.02 -31.3%

2007 HK Equity Country Garden Holdings Co Ltd 12.10 258.22 16.28 13.67 9.94 2.79 2.68 2.24 18.54 21.06 4.45 2.40 14.20 -14.8%

1109 HK Equity China Resources Land Ltd 23.75 164.61 8.44 8.71 7.47 1.41 1.25 1.11 16.81 15.64 4.04 3.33 36.94 -35.7%

1918 HK Equity Sunac China Holdings Ltd 32.00 132.29 26.57 37.92 15.56 4.53 3.99 3.09 17.43 9.02 4.45 1.04 30.65 4.4%

960 HK Equity Longfor Properties Co Ltd 19.26 113.48 9.63 9.75 8.00 1.50 1.38 1.22 16.33 14.90 5.29 3.70 30.57 -37.0%

2777 HK Equity Guangzhou R&F Properties Co Lt 18.32 59.03 7.20 6.20 5.20 1.14 0.96 0.85 16.00 16.62 11.91 6.74 29.10 -37.0%

813 HK Equity Shimao Property Holdings Ltd 15.70 53.18 7.48 6.33 5.40 0.82 0.76 0.69 11.27 12.47 6.91 5.65 28.17 -44.3%

3380 HK Equity Logan Property Holdings Co Ltd 8.17 44.91 5.77 9.10 6.87 2.08 1.60 1.38 37.86 19.68 7.63 4.38 12.91 -36.7%

3383 HK Equity Agile Group Holdings Ltd 10.80 42.30 10.04 8.07 6.96 1.01 0.88 0.82 10.22 11.10 5.04 5.14 17.62 -38.7%

817 HK Equity China Jinmao Holdings Group Lt 3.95 42.17 9.55 10.02 8.14 1.13 1.09 1.00 11.46 11.61 4.31 5.20 6.61 -40.3%

3377 HK Equity Sino-Ocean Group Holding Ltd 4.95 37.30 6.23 8.16 6.71 0.68 0.68 0.63 11.37 8.47 5.66 4.96 9.23 -46.4%

884 HK Equity CIFI Holdings Group Co Ltd 4.25 31.96 8.60 6.86 5.52 1.62 1.37 1.17 20.19 22.12 6.15 5.22 8.41 -49.5%

604 HK Equity Shenzhen Investment Ltd 3.54 28.14 5.25 7.94 6.81 0.74 0.75 0.70 14.80 9.84 5.47 5.79 8.96 -60.5%

1813 HK Equity KWG Property Holding Ltd 8.00 25.24 5.74 5.87 4.86 0.84 0.79 0.71 15.23 13.93 10.16 6.21 14.40 -44.5%

410 HK Equity SOHO China Ltd 4.83 25.11 4.95 67.09 63.95 0.58 0.65 0.64 11.93 1.26 0.00 5.13 7.77 -37.8%

3900 HK Equity Greentow n China Holdings Ltd 9.41 20.37 8.99 8.82 8.09 0.70 0.65 0.61 7.87 6.99 2.14 1.87 18.04 -47.8%

754 HK Equity Hopson Development Holdings Lt 8.80 19.58 5.70 13.54 12.75 0.34 - - 6.15 - 1.45 2.27 N/A N/A

123 HK Equity Yuexiu Property Co Ltd 1.54 19.10 10.51 9.00 7.72 0.53 0.51 0.49 5.11 5.54 5.99 4.60 3.38 -54.4%

272 HK Equity Shui On Land Ltd 1.95 15.72 9.89 7.31 7.68 0.35 0.31 0.30 3.25 4.18 2.98 2.72 5.51 -64.6%

Simple Average 11.72 12.94 10.52 1.57 1.37 1.17 14.27 14.08 4.89 4.16

NAVP/E P/B ROE (%) DivYield(%)

7

Disclaimer

This research report is not directed at, or intended for distribution to or used by, any person or entity who is a citizen or resident of or located in any jurisdiction where such distribution, publication, availability or use would be contrary to applicable law or regulation or which would subject China Galaxy International Securities (Hong Kong) Co., Limited (“Galaxy International Securities”) and/or its group companies to any registration or licensing requirement within such jurisdiction.

This report (including any information attached) is issued by Galaxy International Securities, one of the subsidiaries of the China Galaxy International Financial Holdings Limited, to the institutional clients from the information sources believed to be reliable, but no representation or warranty (expressly or implied) is made as to their accuracy, correctness and/or completeness.

This report shall not be construed as an offer, invitation or solicitation to buy or sell any securities of the company(ies) referred to herein. Past perfor-mance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or implied, is made regard-ing future performance. The recipient of this report should understand and comprehend the investment objectives and its related risks, and where necessary consult their own independent financial advisers prior to any investment decision.

Where any part of the information, opinions or estimates contained herein reflects the personal views and opinions of the analyst who prepared this report, such views and opinions may not correspond to the published views or investment decisions of China Galaxy International Financial Holdings Limited and any of its subsidiaries (“China Galaxy International”), directors, officers, agents and employees (“the Relevant Parties”).

All opinions and estimates reflect the judgment of the analyst on the date of this report and are subject to change without notice. China Galaxy Interna-tional and/or the Relevant Parties hereby disclaim any of their liabilities arising from the inaccuracy, incorrectness and incompleteness of this report and its attachment/s and/or any action or omission made in reliance thereof. Accordingly, this report must be read in conjunction with this disclaimer.

Disclosure of Interests

China Galaxy Securities Co., Ltd. (6881.HK; 601881.CH) is the direct and/or indirect holding company of the group of companies under China Galaxy International.

China Galaxy International may have financial interests in relation to the subjected company(ies) the securities in respect of which are reviewed in this report, and such interests aggregate to an amount may equal to or more than 1 % of the subjected company(ies)’ market capitalization.

One or more directors, officers and/or employees of China Galaxy International may be a director or officer of the securities of the company(ies) men-tioned in this report.

China Galaxy International and the Relevant Parties may, to the extent permitted by law, from time to time participate or invest in financing transac-tions with the securities of the company(ies) mentioned in this report, perform services for or solicit business from such company(ies), and/or have a position or holding, or other material interest, or effect transactions, in such securities or options thereon, or other investments related thereto.

China Galaxy International may have served as manager or co-manager of a public offering of securities for, or currently may make a primary market in issues of, any or all of the entities mentioned in this report or may be providing, or have provided within the last 12 months, significant advice or invest-ment services in relation to the investment concerned or a related investment or investment banking services to the company(ies) mentioned in this report.

Furthermore, China Galaxy International may have received compensation for investment banking services from the company(ies) mentioned in this report within the preceding 12 months and may currently seeking investment banking mandate from the subject company(ies).

Analyst Certification

The analyst who is primarily responsible for the content of this report, in whole or in part, certifies that with respect to the securities or issuer covered in this report: (1) all of the views expressed accurately reflect his or her personal views about the subject, securities or issuer; and (2) no part of his or her compensation was, is, or will be, directly or indirectly, related to the specific views expressed by the analyst in this report.

Besides, the analyst confirms that neither the analyst nor his/her associates (as defined in the code of conduct issued by The Hong Kong Securities and Futures Commission) (1) have dealt in or traded in the securities covered in this research report within 30 calendar days prior to the date of issue of this report; (2) will deal in or trade in the securities covered in this research report three business days after the date of issue of this report; (3) serve as an officer of any of the Hong Kong-listed companies covered in this report; and (4) have any financial interests in the Hong Kong-listed companies cov-ered in this report.

Explanation on Equity Ratings

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No part of this material may be reproduced or redistributed without the prior written consent of China Galaxy International Securities (Hong Kong) Co., Limited.

China Galaxy International Securities (Hong Kong) Co. Limited, CE No.AXM459

Room 3501-3507, 35/F, Cosco Tower, Grand Millennium Plaza, 183 Queen’s Road Central, Sheung Wan, Hong Kong. General line: 3698-6888.

BUY share price will increase by >20% within 12 months in absolute terms :

SELL share price will decrease by >20% within 12 months in absolute terms :

HOLD no clear catalyst, and downgraded from BUY pending clearer signal to reinstate BUY or further downgrade to outright SELL :

Documents

2 HK Equity CLP Holdings Ltd 80 202,116 15.77 15.21 1.99 3 ... · 2016. The ASP for most projects has improved. For 2H17, the focus of contracted sales will be on (1) TODTOWN, a project