Event:
The company issued 2008 annual report; according to which, it realized operating revenue of Rmb16.820bn (-3.75% yoy), net profit attributable to parent of Rmb267mn (-16.74% yoy) and EPS of Rmb0.54.
Our Analysis and Estimation:
1. Real estate business plays an important role in performance growth in 2009-2010.
2. Financing structure will be improved.
3. Western side of economic zone will be a catalyst for share price.
Investment Suggestion
We predict the company’s 2009-2011E EPS to be Rmb0.55, Rmb0.70 and Rmb0.79 respectively. Although commerce affairs are still in adjustment, and real estate development has great uncertainties, we still hold optimistic view on the long-term development of the company; anticipation on the western side of economic zone will substantially boost its prospect. We maintain “Cautious” rating for the counter.