Jinwu Financial News | CMB International is cautiously optimistic about real estate and property management. It is expected that a positive policy tone and active trading sentiment will drive the restoration of fundamentals. The bank believes that real estate sector valuation may continue to maintain the current recovery trend, mainly because 1) positive changes in top-level policy attitudes have brought some confidence to the market; 2) in the current context, several important negative factors may have been absorbed by the market; 3) most long-term capital allocations to real estate are extremely low. In a context where sector valuations are low, top-level policy attitudes are shifting, and important negative factors have been priced-in, increasing the allocation of the sector may be a good choice. At the same time, the bank expects the positive policy tone and the restored trading sentiment in the real estate sector to be transmitted to sales, land auctions, etc., leading to effective improvements in the fundamentals of the industry.
In terms of stock selection, the bank recommends property management companies such as Huarun Vientiane Life (01209, purchase), which has benefited from changes in the new housing supply structure, high performance and full dividend payment for the second time; since the industry will enter the inventory era for a long time, the “price for volume” in the second-hand housing market will continue to drive up transactions, so the bank recommends property management companies that directly benefit from the second-hand housing market shell (BEKE US, purchase), and the stock service concept Wuyun (02602, purchase), Binjiang Service ( 03316, buy), etc. On the developer side, the bank recommended China Resources Land (01109, purchase), which has long-term holding value.