In the past period, the most concerned in the real estate circle is the 2023 annual reports of various real estate companies, and the data released can be described as ice and fire, and the gap between central state-owned enterprises and private enterprises is getting wider and wider.
01
According to the financial reports of 15 key listed real estate companies, only 4 have positive net profit growth, they are central state-owned enterprises China Resources, China Shipping, China Merchants and Greentown, of which China Resources and China Overseas won the top two with 31.3 billion and 25.6 billion yuan, becoming the new leading big brother in real estate.
However, the annual reports of private enterprises have not improved at all, and it is still the norm for profits to shrink sharply or even lose money.
Country Garden, a 100 billion real estate company, fell into a suspension and postponed the issuance of its annual report, and the sales of equity contracts in March this year were only 4.30 billion yuan, down 83% year-on-year.
The cash short-term debt ratio of Agile, China SCE Group, CIFI and other companies is less than 50%, and the book cash is seriously in short supply.
Although Sunac completed the debt restructuring earlier, the asset-liability ratio excluding advance receipts has climbed to more than 70% for the first time, and it is moving towards insolvency.
In this atmosphere of "big failure" of private enterprises, 4 private enterprises have become "outliers", passing through a large number of cleared industry cycles, and their performance is extremely stable, ranking in the top 20 in the sales ranking of real estate enterprises from January to March 2024, and even 2 are in the top 10, they are:
Longfor, Binjiang, Midea Real Estate, Xincheng Holdings.
In such a difficult market in 2023, what did they do right to avoid the collective thunderstorm of private enterprises and survive, the reasons behind it are worth pondering.
02
The first is balanced development, not only residential, these real estate companies have laid out other businesses that can make blood, and the eggs are placed in different baskets, so as to better resist risks.
For example, Longfor's annual report shows that its profit attributable to shareholders in 2023 will be 12.9 billion, with a core after-tax profit margin of 8.7%, which is not simple in the current market.
Even if the residential market is down, other businesses can make their own blood and provide stable cash flow for a long time, which makes many private enterprises look forward to it.
In previous years, other real estate companies were still in high turnover and high leverage, and Longfor invested 10% of the sales proceeds into investment properties every year.
03
The second is that these private enterprises have obtained financing that can continue their lives - operating property loans.
At the moment when the cash flow of private enterprises is difficult, it is certainly not enough to repay debts by relying on project sales proceeds, and it is necessary to fight a bloody way in financing channels.
For example, in 2023, Xincheng Holdings will add about 14 billion yuan of operating property loans and other financing collateralized by Wuyue Plaza, and there are still about 40 billion yuan of investment properties valued at unmortgaged, which can be used to repay public debts due this year.
For example, by the end of 2023, the company's operating property financing will be about 47.4 billion yuan, and the average financing cost is less than 4%, which is very low, basically the same level as central state-owned enterprises.
In addition, Longfor already has about 70 shopping malls for financing, and about 40 more, and plans to add 20 billion yuan of financing this year, which can cover the balance of debt due in 2024 of 14.7 billion.
In fact, operating property loans are the government's initiative to throw private enterprises "lifeline", in January the corresponding policy was introduced to allow commercial banks to help high-quality real estate enterprises revitalize the stock of assets, the implication is that there are high-quality commercial assets as a bargaining chip of private enterprises, in order to get the player ticket.
Especially at the moment of stimulating consumption, the importance of business to private enterprises shines brightly.
04
It is also worth mentioning that the current industry has undergone drastic changes, and the trading thinking has also undergone earth-shaking changes.
Now, major real estate companies have begun to downsize and streamline their personnel, deepen their base camps, and focus outstanding groups on the core sectors of high-energy cities.
In the past five years, they have 60%-80% of the area in Hangzhou, and plan to have no more than 10% of projects outside the province, and the main target outside the province is also a leading real estate city like Shanghai.
As we all know, Hangzhou has taken advantage of the G20 and the Asian Games to develop very rapidly in the past five years, quite the momentum of China's fifth city, the value of land has risen sharply, and the average price has risen to more than 30,000 yuan.
Binjiang Group has received a big cup of soup from it, and has been the double champion of the sales operation list and equity list in Hangzhou for two consecutive years, and its revenue has increased for five consecutive years, and its net profit has increased for four consecutive years, which is rare in the industry.
The more focused the more correct it is in the right city, the more it is to deeply cultivate a core city, not to spread the pie, and stabilize profits, which is the magic weapon for a few private enterprises to survive.
05
At present, the predicament of private enterprises is embarrassing, most of the top 100 real estate companies were private enterprises in the past, and now private enterprises have become a minority.
But it is precisely because of the demonstration of these minorities that the real estate companies that have been thundered or are about to thunder can see hope, and under the big waves, the last thing that can stay must be the essence.
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