Profit Of 100 Billion Housing Enterprises "Defend War"

In order to rush sales scale and financing convenience, many housing companies have sacrificed their rights and interests, and the sales have been greatly increased with full caliber sales. Along with the strategic layout of the country, many listed housing enterprises began to think about how to maintain the growth of revenue and profit after the stage scale sale.

This year, the sales performance of housing companies is better. According to the 1-11 month sales figures released in 2019, most of the top 100 housing companies can exceed the annual sales target, but there is a phenomenon worth paying attention to: hundreds of millions of Housing enterprises are striving to raise their equity ratio.

The new group of 100 billion club Binjiang (002244.SZ, referred to as "Binjiang"), its sales rights and interests is only 40%, which is significantly lower than the other hundred billion housing enterprises mainstream 50%-60% interests. However, according to Qi Jinxing, chairman of Binjiang, the rights and interests of the company will be above 50% this year, and the proportion of sales rights and interests will increase next year.

The housing companies close to Binjiang's situation, including 01966.HK, 01996.HK, or Hongyang, and so on, have a sales target of 70 billion and a 50% share in 2019. In order to rush sales, Zhong Jun's equity ratio has dropped to more than 50% from over 74% in 2016. However, most of them still hold more than 50% from its rights and interests ratio this year. Hongyang's target sales volume is 60 billion in 2019, and its equity is about 50%.

Zhang Hongwei, chief analyst of the same policy research institute, believes that before scaling up to 100 billion scale, the housing enterprises will scale up the scale. Generally speaking, when the market is expected to be good in the future, most housing enterprises will increase their rights and interests, so that future profits and profits will also be improved. When market expectations are bad, housing companies reduce risks by reducing their rights and interests. At this time, sales scale is calculated according to the full caliber. For example, Xu Hui (00884.HK), Zhong Jun, Hongyang and other large proportion of cooperation is such logic.

The intensification of regional differentiation is the main reason for the cooperation of Housing enterprises. Zhang Hongwei said that the Binjiang group has more projects in its base camp than Hangzhou. This year, it is logical to achieve 100 billion goals by reducing the rights and interests. The volume of turnover in the Hangzhou market has been on the rise for the past two years. After this stage, many housing enterprises begin to increase land rights and interests. If they do not raise their rights and interests, they will be faced with a situation of decreasing revenues and profits.

Rights reduction: scale demands under regional differentiation

By the end of 11 this year, nearly 7 of the enterprises that set the performance targets in the year have achieved more than 90% of housing prices. Among them, Shimao, Longhu, sunshine city, Jinke, Zhongliang, Yuzhou, Baolong and many other housing enterprises have reached the annual target ahead of schedule.

But behind the scale growth is the demand of Housing enterprises for rights and interests. Combing earnings data is not difficult to find that housing prices to reduce the ratio of equity is an important reason for the obvious market differentiation.

Even in the 200 billion way, Xu Hui faces a problem of lower equity. In the first half of 2019, Xu Hui realized 48 billion 640 million yuan in equity sales, accounting for 55.3%, which was lower than its equity sales ratio at the beginning of the year 56.67%.

The layout of Xuhui market can be seen. Up to the end of 2018, Xu Hui total land storage amounted to 55 million square meters, corresponding to the value of 800 billion yuan, which accounted for 91% in the first tier, second tier and quasi second tier cities, and the pressure of the rapid development and sales of these cities increased sharply due to the policy adjustment of the purchase price restriction.

Data from the Kerri Research Center showed that in November, the volume of volume in the first tier cities rose steadily, rising by 6% over the same period, up 28% from the same period last year, but the volume of 25 cities in the two or three lines slowed down, and the decline narrowed significantly, while the ratio fell slightly by 2%, down 15% from the same period last year.

Cities continue to differentiate. Chongqing, Kunming, Hangzhou and other markets are still strong, trading volume is increasing. And Changsha, Fuzhou and other markets continued to turn cold, trading volume, ring ratio nearly cut.

The region is also differentiated. Xuzhou and Nanjing in the Yangtze River Delta region have weakened, and Shanghai and Hangzhou have significantly increased their turnover. Ningbo's growth in the same month and the ring ratio is over 7. The central and western cities were significantly divided, and the volume of transactions in Chongqing, Kunming, Chengdu and other cities stabilized and picked up. Wuhan, Zhengzhou, Xi'an and other cities were steadily falling, and the Changsha market was frozen rapidly, with a decrease of 63%.

A fact is that the willingness of enterprises to invest in land is still relatively strong, but the tightening of capital and price fixing policy make enterprises pay more attention to the profit margins of land.

For the second tier cities, the impact of price restriction is gradually increasing. To ensure profit margins, housing companies are more focused on opportunities and reduce the impact of regulation policies to the greatest extent. For the three or four line, the investment in these cities has been reduced due to the gradual decline of most cities' heat. Combined with these factors, housing companies prefer to lay out the second tier cities with more population and stronger demand.

In the 1-11 months of 2019, the sales value of the top 10 housing companies averaged 415 billion 720 million yuan, the average sales growth rate was 18%, the 11-30 sales average was 141 billion 960 million yuan, the average growth rate was 22.4%, the sales value of 31-50 enterprises and 51-100 enterprises were 78 billion 660 million yuan and 35 billion 830 million yuan respectively, and the average growth rates were 35 billion 830 million and 35 billion 830 million respectively. Among them, 31-50 enterprises are the highest average sales growth camp, followed by 11-30 enterprises.

Housing companies only have to scale while ensuring that profits can be better. Since the beginning of this year, the growth rate of large housing enterprises has generally slowed down, and some hundred billion scale housing enterprises have welcomed growth opportunities. For example, the Hangzhou market has been improving for the past two years, and most of the housing enterprises have chosen to cooperate with each other.

Equity enhancement: to protect profit growth

Sales growth at the same time, small and medium housing prices this year to pay more attention to the promotion of rights and interests. For example, Yu Chau real estate (01628.HK) sales target of 68 billion yuan this year, its chairman Lin Longan in a recent roadshow on the reverse revealed that this year Yu Chau estate in the interests of land intends to raise to 50%.

Insiders pointed out that after the sales scale of large housing enterprises, they could adjust their strategies at any time to sort out their internal management, while small and medium-sized Housing enterprises were different. They chose to leverage their rights and interests, enlarge their leverage and make high profits. On the other hand, the cooperative development of these small and medium-sized Housing enterprises also brought out problems of unstable quality and reduced profits.

In fact, at the end of the year, the housing industry accelerated the pace of supply, and the supply of 29 key cities rebounded significantly. However, the market expectations of the caudate market is not yet, the volume of key cities in the same volume, the chain fell by 12% and 1% respectively, the downward pressure on the market is still larger.

At this time, housing companies are still facing the pressure of capital withdrawal. "On the basis of not increasing the leverage, pre payment is the first source of money, and efficient use of funds is very important. Cash withdrawal is fast. Cash in the back is not only interest free but also negative interest. " Qi Jinxing predicted that in 2019, the amount of Binjiang's capital withdrawal would be between 320-340 billion, and hoped that the cash withdrawal from the company could reach 45 billion in 2020.

In addition, Qi Jinxing revealed that Binjiang will be more refined in terms of product quality and cost control. In the first three quarters, Binjiang's net cash inflow was 6 billion yuan, which was estimated to be around 7 billion yuan in the whole year. The net cash withdrawal continued to grow at a current rate of over 30 billion yuan, and the loan was 31 billion yuan, an increase of 5 billion 700 million yuan compared with last year, and interest rates also declined.

On the contrary, in 2018, Binjiang is moving rapidly into the 100 billion camp. One obvious feature of this housing enterprise is the reverse growth of revenue and profit. In 2018, the net profit attributable to shareholders of listed companies was 1 billion 198 million to 1 billion 711 million in 2018, which changed from -30.00% to 0 over the same period, and the average net profit growth rate of real estate development was 34.52%. Meanwhile, Binjiang's sales volume was 85 billion 10 million yuan in 2018, an increase of 38.23% over the same period last year.

According to Qi Jinxing, the scale of Binjiang's "stability" in 2020 is only 100 billion. "This year, the company has achieved investment balance. Next year will be a financial balance and financing balance, and the team balance will be achieved next year."

"At present, management costs account for about 1.5%, and I propose to fight for about 1%, and general enterprises are 5%." Qi Jinxing disclosed that, as a measure of the enterprise's fine management ability, the three fee (management, marketing, Finance) rate, Binjiang can achieve 1/4 of the same level housing enterprises. In addition to lower management costs in the industry, Binjiang's financing costs are also low, showing a declining trend from 5.8% in 2018 to 5.6% in mid 2019. (Editor: Lu Yu)