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.

High Yield Experts

Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

Credit

In our view, Guangzhou R&F's H1/19 results were weak. The company reported revenue growth of 3%, but margins were lower. Gross profit and EBITDA declined 1% and 6%, respectively. While revenue recognition could pick up in H2, we expect margins to remain under pressure, in line with the soft ASP. The company may miss its full-year sales target, having achieved only 44% of the CNY 160 bn target in the first seven months of 2019. This could prompt it to further sacrifice ASP and margins in order to boost volumes. Leverage deteriorated and the financial profile remains weak. In H1, the company reduced land acquisition spending by 15%, which helps to shore up cash and may signal a shift in strategy towards deleveraging, given tighter funding conditions. The company’s land bank is sizeable and sufficient for 4-5 years of development, supporting a slower pace of acquisitions. Guangzhou R&F has yet to carry out a material equity issuance, despite having floated plans to issue additional H-shares and to list A-shares onshore.

   In our view, Guangzhou R&F's H1/19 results were weak. The company reported revenue growth of 3%, but margins were lower. Gross profit and EBITDA declined 1% and 6%, respectively. While revenue recognition could pick up in H2, we expect margins to remain under pressure, in line with the soft ASP. The company may miss its full-year sales target, having achieved only 44% of the CNY 160 bn target in the first seven months of 2019. This could prompt it to further sacrifice ASP and margins in order to boost volumes.    Leverage deteriorated and the financial profile remains weak. In H1, the company reduced land acquisition spending by 15%, which helps to shore up cash and may signal a shift in strategy towards deleveraging, given tighter funding conditions. The company’s land bank is sizeable and sufficient for 4-5 years of development, supporting a slower pace of acquisitions. Guangzhou R&F has yet to carry out a material equity issuance, despite having floated plans to issue additional H-shares and to list A-shares onshore. 

Guangzhou R&F - Earnings Flash - H1 FY 2019 Results - Lucror Analytics

Guangzhou R&F Properties

Guangzhou R&F - Earnings Flash - H1 FY 2019 Results - Lucror Analytics