Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.<ul><li><a href='#lucror-entity-8954'>Greentown China</a></li><li><a href='#lucror-entity-12763'>Tata Motors ADR</a></li></ul>

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.Greentown ChinaTata Motors ADR

Morning Views Asia: Greentown China, Tata Motors ADR

Analyst

Steve Zhou, CFA

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/greentown-china-holdings" target="_blank" data-smartkarma-citation="entities:8954:1" rel="noopener">Greentown China (3900 HK)</a> is a high quality China property developer that is unfairly suppressed given the extreme pessimism of the sector.  </li>
<li>Even though the overall sales of China property industry will likely continue to decline, the market is large enough that some developers could stand to gain massive market share.  </li>
<li>The company trades at 2.5x 2024E PE, and 71% discount to NAV, with expected growth in net profit in 2023 and 2024.  </li>
</ul>



Greentown China (3900 HK) is a high quality China property developer that is unfairly suppressed given the extreme pessimism of the sector.  
Even though the overall sales of China property industry will likely continue to decline, the market is large enough that some developers could stand to gain massive market share.  
The company trades at 2.5x 2024E PE, and 71% discount to NAV, with expected growth in net profit in 2023 and 2024.  


Greentown China (3900 HK):  Disciplined Market Share Gainer Amid Chaos

Greentown China has released H1/23 results that were in line with expectations. Contracted sales rose 16% y-o-y, driven by higher ASP (+19%), but offset to a degree by less GFA sold (-1%). The company added CNY 57 bn saleable resources with total GFA of 2.57 mn sqm. Revenue fell 12% to CNY 57 bn, primarily due to a CNY 7.9 bn slide in revenue from property development. Gross profit also decreased 12% to CNY 9.92 bn, with a largely stable margin (16% vs. 16.5% in H1/22). We believe Greentown will continue its strategy of clearing inventories and delivering homes through H2/23. The company's ability to deleverage will be impacted by the scale of its land acquisitions. In this regard, Greentown could expend up to 40% of its sales proceeds on acquisitions. That said, the level may be tempered by any further deterioration in the residential housing market.

  Greentown China has released H1/23 results that were in line with expectations. Contracted sales rose 16% y-o-y, driven by higher ASP (+19%), but offset to a degree by less GFA sold (-1%). The company added CNY 57 bn saleable resources with total GFA of 2.57 mn sqm. Revenue fell 12% to CNY 57 bn, primarily due to a CNY 7.9 bn slide in revenue from property development. Gross profit also decreased 12% to CNY 9.92 bn, with a largely stable margin (16% vs. 16.5% in H1/22).   We believe Greentown will continue its strategy of clearing inventories and delivering homes through H2/23. The company's ability to deleverage will be impacted by the scale of its land acquisitions. In this regard, Greentown could expend up to 40% of its sales proceeds on acquisitions. That said, the level may be tempered by any further deterioration in the residential housing market. 

Greentown China - Earnings Flash - H1 FY 2023 Results - Lucror Analytics

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.<ul><li><a href='#lucror-entity-8954'>Greentown China</a></li></ul>

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.Greentown China

Midea Real Estate Holding  / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/midea-real-estate-holding-ltd" target="_blank" data-smartkarma-citation="entities:27450:1" rel="noopener">Midea Real Estate Holding (3990 HK)</a> announced last night a proposal for distribution in specie of the property development business to shareholders.</li>
<li>The proposal allows shareholders to select between receiving pro rata shares in the PrivateCo, or the cash alternative at HKD5.90 per share, a 57% premium to last close at HKD3.75. </li>
<li>I believe this is a good deal for minority shareholders.  The company (ex. property development business) will continue to be listed on the HKSE after the distribution.  </li>
</ul>



Midea Real Estate Holding (3990 HK) announced last night a proposal for distribution in specie of the property development business to shareholders.
The proposal allows shareholders to select between receiving pro rata shares in the PrivateCo, or the cash alternative at HKD5.90 per share, a 57% premium to last close at HKD3.75. 
I believe this is a good deal for minority shareholders.  The company (ex. property development business) will continue to be listed on the HKSE after the distribution.  


Midea Real Estate (3990 HK):  Divesting Property Development Business (Cash Option At 57% Premium)

China

Greentown China Holdings Ltd. develops real estate.  The Company builds residential villas, low-rise apartment buildings, and high-rise apartment buildings for middle and high-income people.

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Greentown China (3900 HK)

Morning Views Asia: Greentown China, Tata Motors ADR

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

Greentown China - Earnings Flash - H1 FY 2023 Results - Lucror Analytics

Greentown China has released H1/23 results that were in line with expectations. Contracted sales rose 16% y-o-y, driven by higher ASP (+19%), but...

Lucror Analytics

Morning Views Asia: Greentown China

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

Midea Real Estate (3990 HK): Divesting Property Development Business (Cash Option At 57% Premium)

Midea Real Estate (3990 HK) announced last night a proposal for distribution of the property development business to shareholders. The cash...

Steve Zhou, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Morning Views Asia: Greentown China, Tata Motors ADR

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics