According to Huafu Securities, GREENTOWN CHINA (03900) achieved revenue of 131.4 billion yuan in 2023, a year-on-year increase of 3.3%; the net income attributable to the parent company, after deducting preferred stock dividends, was 3.09 billion yuan, a year-on-year increase of 19.6%.
The report pointed out that the company's holding subsidiary GREENTOWN MGMT is the first stock in China's construction industry, maintaining a market share of over 20% for eight consecutive years due to its first-mover advantage and good reputation, firmly establishing itself as the industry leader. In 2023, GREENTOWN MGMT's revenue and net income attributable to the parent company were 3.3 billion yuan and 0.97 billion yuan respectively, with growth rates of 24.3% and 30.8% respectively, and a net margin of 29.7%. The share of commercial construction in GREENTOWN MGMT's construction business is increasing, and it has a sufficient reserve of marketable housing values, providing impetus for the company's profit growth.
The report indicated that the company's main business revenue for 2024-2026 is expected to be 135.2/139.5/142 billion yuan, with net income attributable to the parent company of 2.772/3.122/3.662 billion yuan, corresponding to PE ratios of 7.9/7.0/6.0. With GREENTOWN CHINA backed by central enterprise shareholders and a strong reputation from established real estate companies; focusing on core cities with sufficient quality land reserves; high turnover and high absorption of self-invested business, sales rankings rising against the trend; construction business firmly leading, with ample marketable value reserves; a reasonable and healthy debt structure, and continuously decreasing financing costs, it is expected that under the background of gradually transmitting the effects of relaxed policies in key first- and second-tier cities, GREENTOWN CHINA can seize the opportunity for industry recovery, and has been given a 'Buy' rating in its first coverage.
