EB SECURITIES: Maintains a "buy" rating on C&D PROPERTY (02156) as associated property companies perform well in operations and community appreciation performance is impressive.

EB SECURITIES released a research report stating that C&D PROPERTY (02156) is a state-owned property management company with strong performance growth and maintaining a "buy" rating. The company's affiliated company Jianfa Real Estate Public Account announced that Jianfa Real Estate's luxury residential project, Xiamen Jianfa Port Comprehensively Starts Ruirui Lake, has won the French Design Award - Annual Real Estate Demonstration Zone Landscape Platinum Award; Jianfa Haiyan has obtained the first "Platinum Level Certification" for a tranquil residence in Beijing. C&D PROPERTY achieved operating income of 1.82 billion yuan in the first half of 2025, a year-on-year increase of 13.8%; achieved gross profit of 460 million yuan, a year-on-year increase of 13.8%; gross profit margin was 25.2%, flat year-on-year; net profit attributable to shareholders was 220 million yuan, a year-on-year increase of 13.2%. EB SECURITIES' main points are as follows: Excellent performance of affiliated sales and strong land acquisition intensity In the first half of 2025, C&D PROPERTY's property management income was 1.06 billion yuan, a year-on-year increase of 23.1%, accounting for 58.0% of total income, with property management business still being the largest source of income and maintaining rapid growth. According to CRIC data, Jianfa Real Estate, the company's affiliated company, achieved a total sales amount of 95.6 billion yuan in the first nine months, a year-on-year increase of 12.1%; added land value of 80.4 billion yuan in the first nine months, ranking 7th in the industry. Jianfa Real Estate has maintained a high intensity in sales and land acquisition, with sufficient property management projects to be delivered in the future, ensuring strong growth for C&D PROPERTY's property management business. Higher regional density in managed projects, scale effects gradually emerging As of June 30, 2025, the company's managed area was 83.28 million square meters, with 74.2% located in the Haixi cluster (mainly in Fujian), showing significant scale effects; in terms of business format, 90.6% of the managed area is residential, with the remaining being office buildings, industrial parks, hospitals, and schools, among other non-residential formats, demonstrating a rich and focused business format. The company's overall gross profit margin in the first half of 2025 was 25.2%, maintaining a high level within the industry; sales and management expense ratio was 11.0%, as the company gradually expands its managed scale, regional density further increases, business synergy strengthens, the company is expected to maintain a high gross profit margin level, with potential for further optimization of the sales and management expense ratio. Community value-added performance impressive In the first half of 2025, the company's community value-added business income was 450 million yuan, a year-on-year increase of 23.5%, with services such as home life, smart community, home beautification, public area value-added, and elderly care all achieving year-on-year positive growth. The business lines are clear, with home life services (including housekeeping, repairs, retail, etc.) meeting the needs of homeowners, achieving a revenue growth of 33.9% year-on-year, accounting for 32.4% of the community value-added sector. Non-resident value-added service income decreased by 19.4% to 280 million yuan year-on-year, mainly due to adjustments in the real estate market and a reduction in the number of sales centers for services. Overall, the company's relevance to real estate development is decreasing, while maintaining steady expansion in the community services sector, with the consumer service attribute gradually strengthening, providing ample room for future development.