EB Securities: Maintains a "buy" rating for China Resources Land (01109) with noticeable increase in average selling price and steady growth in asset operation.

EB SECURITIES released a research report stating that it maintains a "buy" rating on CHINA RES LAND (01109). Considering that the national real estate sales are still in a downward trend, there is significant differentiation between cities and regions, and the company's sales of residential properties in 1-8 months have followed the industry's trend of double-digit decline. The forecasted net profit attributable to the parent company for 2025-2027 has been revised to 24.74/25.27/25.53 billion yuan (originally 26.25/28.15/28.93 billion yuan), with the corresponding PE multiples for 2025-2027 being 8.5/8.3/8.3 times. The company has a good brand reputation, focuses on real estate development in core cities, and provides stable cash flow from asset operation. The company's credit advantage is significant. EB SECURITIES' key points are as follows: Event: Unaudited operating data as of August 31, 2025 has been released by the company. In August 2025, the company achieved contract sales of 13.2 billion yuan, a year-on-year decrease of 13.2%; contract sales area of 539,000 square meters, a year-on-year decrease of 26.7%. From January to August 2025, the company achieved contract sales of 136.8 billion yuan, a year-on-year decrease of 12.0%; contract sales area of 51.2 million square meters, a year-on-year decrease of 23.3%. Average selling price has significantly increased, sales structure focuses on core areas From January to August 2025, the company achieved contract sales of 136.8 billion yuan, ranking among the top three in the industry according to the CRIC sales ranking. In the first half of 2025, the company achieved contracted sales of 110.3 billion yuan (a decrease of 11.5% year-on-year), contracted sales area of 4.12 million square meters (a decrease of 20.9% year-on-year), and contract sales price of 26,800 yuan/square meter (an increase of 11.9% year-on-year). The sales structure focuses on core areas, with a significant increase in the average selling price, and ranking among the top three in market share in 15 cities. In terms of land acquisition, the company adheres to the principle of "quantity in, quantity out", reasonably controls the investment pace, focuses on first and second-tier cities, and had equity investments of 32.28 billion yuan in the first half of 2025, adding 1.48 million square meters of land reserves, effectively supplementing high-quality land reserves in core cities. As of June 30, 2025, the company's total land reserve area is 48.95 million square meters. Stable growth in asset operation, contribution to stable cash flow The company's asset operation segment has achieved steady growth, significantly contributing to performance and long-term stable cash flow. In the first half of 2025, the operating income of the asset operation segment was 121.1 billion yuan (an increase of 5.5% year-on-year). 1) As of June 30, 2025, the total construction area of shopping centers is 11.85 million square meters (an increase of 13.3% year-on-year), with 94 operating shopping centers, retail sales of 110.15 billion yuan (an increase of 20.2% year-on-year), and a overall operating profit margin of 65.9%, reaching a new historical high. 2) As of June 30, 2025, the total construction area of office buildings was 1.46 million square meters (an increase of 7.8% year-on-year), with 23 operating office buildings, an average occupancy rate of 74.5% in the first half of the year, maintaining industry leadership. Significant credit advantage, optimized financing costs The company adheres to the principle of "quantity in, quantity out" in fund management, always considering cash flow safety as the lifeline of corporate development. As of June 2025, the company had cash reserves of 120.24 billion yuan, a net interest-bearing debt ratio of 39.2%, and a weighted average financing cost had decreased by 32 basis points to 2.79% compared to the end of 2024, maintaining the lowest level in the industry. The optimization of financing costs and significant credit advantage.