According to its 2008 annual report, the company realized total business turnover of Rmb40.992bn (+15.38% yoy), net profit attributable to parent of Rmb4033mn (-17.26% yoy), and EPS of Rmb0.37. The company planned to distribute pretax cash dividend of Rmb0.5 for every ten shares.
We forecast the company’s contract sales volume in 2009 to be Rmb57bn (+20% yoy), and settlement income of Rmb44.6bn (+9% yoy). According to its 2008 annual report, the company obtained lands at average price of Rmb2, 000/sq.m after losses of land release risks being accrued, thus its future stock risks are likely to be reduced. Moreover, after depression for more than half a year, industrial turnover at 2008 yearend indicated a sign of recovery, and we hereby maintain “Overweight” rating intact. The company’s EPS in 2009-2010E is Rmb0.50 and Rmb0.63 respectively, and dynamic P/E ratio is at16x and 13x based on closing price of Rmb7.89 on February 9, 2009.