Who Is The Rival Of Wanda Listed On The Main Board Of The Hkex?

Alibaba set the final stop of the global roadshow in Hongkong, and faced with the loss of the Hong Kong stock exchange, Ma Yun regretted it.

However, on the second day of Ma's departure from Hongkong, the HKEx turned its way to the biggest IPO of the year, the domestic commercial giant Dalian Wanda Commercial real estate Limited by Share Ltd (the "Wanda Commercial real estate"), which launched the main board of the HKEx.

One has the largest online consumer platform in the country, and the other has the largest offline consumer platform in the country. Although both companies have passed A shares, the two companies churned the global capital market almost at the same time in the autumn of 2014.

In September 19th, Alibaba will issue a final price of $68 per share, raising the amount of $21 billion 800 million, and its market capitalization to $168 billion, far exceeding that of its rival Amason. However, who will be his rival for Wanda Commercial real estate, which is about to start the road show?

Is it Vanke?

In the domestic real estate industry, Vanke is still the boss.

As of September 17th, Vanke A closed at 9.27 yuan per share, Vanke enterprises closed at HK $14.38 per share, corresponding to Vanke A+ H-share's total market value of 102 billion 100 million yuan, is currently the largest market share of A shares Real Estate Company.

Supporting the Vanke 100 billion market capitalization is the industry's top achievement.

As of June 30th this year, Vanke's total assets amounted to 501 billion 800 million yuan, and its net assets amounted to 76 billion 900 million yuan. In the first half of this year, its main business income was 41 billion yuan, earning nearly 5 billion 500 million yuan net profit. These financial indicators were far higher than those of A shares and listed companies in the same industry.

From the comparable financial figures, the total assets of Wanda Commercial Real Estate in the same period were 504 billion yuan, similar to Vanke, but its net assets amounted to 112 billion 600 million yuan, 46% higher than that of Vanke. In the first half of this year, the main business income of Wanda Commercial real estate was 23 billion 250 million yuan, only about half of Vanke, but the net profit close to 5 billion yuan in the same period was almost the same as Vanke.

Similarly, the financial contrast data from 2013 also showed this contrast. During the period, the total assets of Wanda Commercial Real Estate were about 10% lower than that of Vanke, but the net assets were 8% higher than that of Vanke. On the main business income, Wanda Commercial real estate was only about 60% of Vanke, but its net profit exceeded Vanke 35%.

Obviously, although both of them are the first tier Real Estate Company in China, the profitability of two companies that belong to commercial real estate and residential real estate is very different.

From the gross margin, Wanda Commercial Real Estate in 2013 was 43%, while the main residential real estate Vanke, Huarun and Hengda were only 27.2%, 28.2% and 29.5% respectively.

It is precisely because of the high gross profit margin of commercial real estate, so in recent years, several major domestic real estate companies have begun to pform into commercial real estate. Huarun land is in July this year, when developing strategic direction, the target is directed at "China's commercial real estate leader".

However, at this time, commercial real estate, which has been pformed into commercial real estate for 14 years, has long been the largest and second largest commercial real estate owner and operator in the world.

According to the data disclosed by Wanda Commercial real estate, by the end of June 30th this year, its self-contained property area was 14 million 700 thousand square meters. It had the largest number of shopping centers in the country, and the number of shopping centers completed and built was up to 168. In addition, Wanda Commercial Real estate was also the largest luxury hotel owner in China, and its completed and built luxury hotels reached 102.

In the first half of this year, Wanda Commercial real estate revenue from property rental and luxury hotels accounted for 22.3% of the total revenue and 7.6% of the total revenue. That is to say, the income structure of Wanda Commercial real estate now accounts for nearly 30% of the income from non real estate sales.

Since self-contained property leasing has higher gross profit margin, in the future, even if the rental income of self-contained property can not exceed that of property sales in the overall income, as long as its proportion continues to increase, it will inevitably promote a substantial increase in net profit.

Since the profit margin of self-sustaining property is higher than that of direct sale, is it not better to wholly own all the developed properties?

In fact, among the old listed Real Estate Company in Hongkong, including Hang Lung real estate, Taigu real estate and so on, and even the largest commercial real estate operator in the United States, Simon Property Group, almost adopted such a model that the commercial projects developed into self-sustaining, and then obtained profits through property leasing.

In terms of financial data, the net sales rates of Hang Lung estate and Swire property reached 77% and 43% respectively last year.

However, the background of this commercial real estate mode is highly urbanized. From the data point of view, the urbanization rate of China's Hongkong is close to 100%, while the urbanization rate of the United States is over 85%, while the urbanization rate of China is only about 50%.

It is also based on the huge domestic market space. Hang Lung estate gradually introduced the Hang Lung Plaza project to many cities in Shanghai, Shenyang, Ji'nan, Wuxi, Kunming and Wuhan. As of the first half of this year, the income from the mainland has accounted for about 43% of the total revenue of Hang Lung estate.

However, because of the high positioning of high-end brands, it also restricts the expansion space of Hang Lung real estate. At present, it can only be confined to a second tier city, and it is difficult to continue downhill.

Unlike foreign mature commercial real estate operators, rooted in the context of China's urbanization, Wanda Commercial real estate, its strategic positioning is "China's urbanization process and consumption upgrading of people's consumption and cultural entertainment platform providers."

This strategic positioning makes Wanda Plaza focus on the consumption of life and culture and entertainment, and at the same time, experience consumption is the core. This makes Wanda Commercial real estate have larger expansion space and sustained high speed growth, and it can go deep into hundreds of three or four line cities nationwide.

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According to the data disclosed in commercial real estate, 159 Wanda Plaza and 8 Wanda cities are completed and built in 112 cities in 29 provinces in China. The completed and built property area is close to 30 million square meters. This figure has exceeded the 24 million 400 thousand square meter property holding area of the US Simon real estate group, the largest commercial real estate operator in the world, and is the largest commercial real estate operator in the world.

Data from Wanda Commercial real estate show that in the past three years, the annual compound growth rates of four financial indicators of total assets, net assets, main business income and net profit were 31.1%, 33.8%, 30.7% and 21.9% respectively.

"Such growth rate is hard to see in the global commercial real estate companies, and its special business mode and scale effect are hard to replicate."

In the background of the real estate industry analysts, under the background of the domestic financing system is not perfect, Wanda Commercial real estate through property sales to ensure the development of investment property and hotel expected cash demand, and thus balance the overall cash flow pattern, is the core of its rapid growth in recent years.

Therefore, unlike most of the real estate developers in China, Wanda Commercial real estate does not take profit as a single purpose in the sale of property. More is to solve the problem of cash flow. It is because of the stable cash flow support that Wanda Commercial real estate projects can be opened in 24 months, and the rate of delivery in 36 months can not be achieved by most developers.

In addition to money, the high executive power of Wanda Commercial real estate is also one of the reasons for the rapid development of the project.

It is said that Wanda Commercial real estate has a standardized development management process on project development. This process divides a single project into 351 nodes, and each node carries out precise control with red, yellow and green lights to enhance the efficiency of each link.

Data show that in 2013, the total number of nodes in the company's total 6984 nodes was only 0.5%.

On the surface, the expansion of Wanda Commercial real estate is only an increase in the number of commercial projects, but behind it is the scramble for the coverage of offline consumer groups.

Just in the past September 10th, Wanda Commercial Real Estate spent 884 million yuan on the two plots of 88 thousand and 900 square meters south of Dianshan Lake Avenue in Qingpu District, Shanghai. It will build seventh commercial projects in Shanghai in the future.

The data show that the area covered by Wanda Commercial real estate projects accounts for about 70% of the total value of GDP, covering 40% of the national population. In the future, Wanda Commercial Real Estate's strategic positioning is to reach more than 1 billion 200 million visitors per year and cover the whole class and all ages.

After becoming the number one real estate operator in the world, many Wanda Plaza will stop when Wanda Commercial real estate develops. Many investors have expressed curiosity because in the eyes of these investors, the growth of this extension has ceiling.

In fact, Wanda Commercial real estate itself is also very clear that the real decision of Wanda Commercial Real Estate competitiveness is not the size of the property it owns, but the growth of the consumption volume caused by the synergy between the various commercial sectors, because only the growth of the consumption population and consumption volume can drive the growth of the company's rent on property.

In August 29th of this year, Wang Jianlin, chairman of Wanda Group, flew to Shenzhen in person. He joined hands with Tencent and Baidu to set up an e-commerce company to achieve the integration between offline and online through O2O.

On the other hand, as the largest e-commerce platform in China, Tmall's Tmall has begun to plan a mature and feasible O2O operation mode with some brands since last year. It is said that the number of contracted brands has exceeded 5000. Then, as the largest offline consumer platform in China, how will Wanda Commercial Real Estate counteract Alibaba in the O2O strategy?

According to the information obtained from various sources, Wanda, Tencent and Baidu will work together to build a big data alliance to achieve the integration of advantageous resources, and create the largest universal integration alliance and platform in China by creating an online and offline integrated account and membership system.

At that time, consumers only need to have a smart card, so they can integrate each other on Wanda and Tencent, Baidu's commercial platforms, and buy their internet financial products. They can also use their independent payment system.

Prior to this, the CEO O2O, who is responsible for this business, also emphasized the difference between its O2O platform and the existing e-business platforms such as Alibaba.