Yanlord Land - OCBC Investment 2023-08-22: Hurt By Industry Malaise

Yanlord Land - Hurt By Industry Malaise

Yanlord (SGX:Z25) | SGinvestors.ioYanlord (SGX:Z25)
  • Yanlord (SGX:Z25)’s recent 1H23 results reflect the challenging operating landscape in China’s property sector. Although revenue jumped 31% y-o-y to CNY14.8b, gross profit increased by a mere 3% to CNY4.2b given significant compression in gross profit margin by 7.5 percentage points (ppt) y-o-y to 28.1%. This margin pressure is not unique to Yanlord, and is a common trend plaguing the entire property development industry in China.
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Gross contracted sales dipped 38% y-o-y to CNY23.0b for 7M23

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  • Most of Yanlord’s projects was sold in Suzhou, Nanjing, Tianjin and Jinan. Management is targeting full year gross contracted sales of CNY45b, which imply a much stronger sales momentum in 2H23.
  • Notwithstanding the sharp deterioration in overall residential market conditions in China recently, we believe Yanlord’s high exposure to Tier 1 cities would make it relatively more resilient, while recent government policy direction has also skewed to easing in the top tier cities.
  • Furthermore, Yanlord owns a portfolio of investment properties and hotels in Singapore which are generating recurring income streams and could also potentially be used to obtain secured lending if needed, in our view.

Net gearing ratio reduced to 46.8% with next offshore bond maturity in Feb 2024

  • Read more at SGinvestors.io.

Above is the excerpt from report by OCBC Investment Research.
Clients of OCBC Securities may be the first to access the full report in PDF @ https://www.iocbc.com/.

OCBC Research Team OCBC Investment Research | https://www.iocbc.com/ 2023-08-22

Previous report by OCBC:
2023-03-10 Yanlord Land - Softer Contracted Sales & Earnings Outlook.

Price targets by other brokers at Yanlord Target Prices.

Listing of research reports at Yanlord Analyst Reports.

Relevant links:
Yanlord Share Price History,
Yanlord Announcements,
Yanlord Dividends & Corporate Actions,
Yanlord News Articles


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