Jinwu Finance News | China International Capital Corporation said that the property management sector continued to consolidate and the valuation attractiveness marginally increased. Last week, key property companies fell by 7.4%, underperforming related developers and the Hang Seng China Enterprises Index by 0.8ppt and 4.2ppt, respectively. On the stock side, the average cumulative decline of stable property companies in the past two weeks (-14%) was slightly lower than that of other private property companies (-19%). As the bank previously pointed out, short-term property beta is still the dominant trend of the property management sector, and the current investment community is gradually switching from actively changing trading policies to the effects of trading policies and risk preferences have gradually fallen. The valuation of the property management sector has also adjusted accordingly. At present, the overall valuation of the sector has returned to the end of April levels (the average forward P/E ratio of stable property companies is 12 times, excluding MixC is 10.7 times). The bank reiterated that the valuation of the sector is supported by structural factors such as business models, short- to medium-term performance growth, and dividends, and has slightly increased attractiveness at the current position.
Based on the current stock valuation cost-effectiveness, the bank continues to recommend: China Overseas Property (02669), Greentown Service (02869), Wanjuyun (02602), Poly Property Services (06049), China Resources Mixc (01209), as well as the leading construction service provider Greentown Management and Control (09979).