南薰樓話: 野村看融創48

2017年10月20日星期五

野村看融創48

野村夠狠，直接把融創(1918)目標價從32調高50%至48。

Reaffirm top pick; catalysts lined up
2017F sales may grow 130% y-y to c.CNY350bn; FY17 earnings should beat consensus significantly

Sales to reach historical high in Oct-Dec; full year likely to rank No. 4
Sunac 9M17 sales increased 133% y-y to CNY204bn, with Sep monthly sales reaching a historical high of CNY43bn. We expect this strong momentum to continue, with Oct/Nov/Dec sales potentially reaching c.CNY45/50/55bn, respectively. As a result, full-year sales should grow c.130% to c.CNY350bn, likely to rank No.4 in the industry.
（10/11/12月潛在銷售可能達到人民幣450億/500億/550億）

Surging earnings for FY17F-19F; consensus greatly underestimating
We expect surging earnings for FY17-19F, driven by: 1) strong property sales (CNY151/350/450bn for 2016/17F/18F) to be gradually booked into revenue; 2) 13 Wanda projects to contribute revenue booking starting from FY17F; and 3) potential adoption of HKFRS15 in FY17F to accelerate revenue booking, given c.30% of its sales were in all-cash payment. Our FY17F/18F/19F core earnings forecasts are 169%/69%/76% above consensus.
（野村2017/18/19核心盈利預測比平均預測高169%/69%/76%）

Strong catalysts lined up; management purchasing shares
The strong catalysts, including strong sales and results, are in our view lined up to support share price performance, especially given the sector lacks positive catalysts in Oct-Dec. Besides, we notice that management (such as Mr. JING Hong, Executive Director and Beijing Regional Manager) has been actively purchasing shares recently.

Reaffirm top pick; TP lifted to HKD48.00, implying 28% potential upside
We reaffirm Sunac as our top pick in the sector, and lift our TP to HKD48.00 (previous: HKD32.00) and FY17F/18F/19F core earnings by 44%/8%/9%, after factoring in recent land acquisitions, contribution from Wanda projects acquisition, and faster sales and revenue booking progress (HKFRS15). Our TP is based on a 20% discount (reduced from 30% to reflect more prudent cashflow; consistent with peers) to FY17F NAV of HKD60.00. The stock trades at 7.6x FY19F P/E (EPS: CNY4.48) and a 37% discount to NAV (vs sector average of 32%).