Jinwu Financial News | First Shanghai Securities released research reports that in the first half of 2024, the company's revenue was 0.314 billion yuan, up 8.8% year on year; gross profit was 0.162 billion yuan, down 1.6% year on year; and net profit to mother was 0.089 billion yuan, down 8.1% year on year. This is mainly due to the increase in the share of revenue from lease-type projects with low gross margins during the period. The number of new leasing model projects opened by the company increased during the period, and the company implemented a business-stabilizing support policy for new projects, which led to a decline in the gross margin of the entire leasing model.
According to the bank, the company focuses on the Greater Bay Area and Yangtze River Delta region, and has a national layout, adhering to its own circle of abilities, focusing on quality over weight, and creating a unique development model for the company. The steady operation of the related party, Galaxy Holdings, keeps the three red lines evergreen, and also provides business guarantees for the company's development. The company insists on refined operation, good quality start-ups, and high-quality expansion.
The bank continued that it is optimistic about the company's ability to expand and operate as a pure commercial management company in the post-real estate cycle. It is expected that from 2024 to 2026, the company will achieve net profit attributable to mother of approximately $0.157 billion, $0.198 billion, and $0.236 billion respectively, giving a price-earnings ratio of 10 times in 2024, corresponding to a target price of HK$1.75. There is room for 55% increase from the current price, and a purchase rating.
