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

Credit Analyst, Lucror Analytics

Chuanyi Zhou

Credit Analyst

Credit

We view Yuzhou Properties as “Medium Risk” on the LARA scale. The company has diversified outside Fujian province, with sizeable operations in the Yangtze River Delta Area (YRD). The company has a strong brand name in its home market Xiamen and key markets, including Hefei, Nanjing, Shanghai and Suzhou. We believe Yuzhou is well-positioned in those markets, as evidenced by the company's decent property sell-through rate. The brisk asset turnover boosts liquidity and cash reserves. That said, Yuzhou’s aggressive debt-funded expansion in both existing and new markets has stretched its credit metrics. Our fundamental Credit Bias on Yuzhou is “Negative”. The company’s highly levered financial risk profile will likely remain stretched as it requires funding for construction and expansion. That said, contracted sales have been recovering from the COVID-19 pandemic's impact, and the expansion has been prudent so far in 2020. Nonetheless, we remain cautious on the company's appetite for expansion, given the aggressive sales target of CNY 100 bn this year. We like the geographical distribution of Yuzhou’s operations, as well as its sales execution and decent access to capital. We view Yuzhou as “Weak” on the LAGA scale. All executive directors are from the Lam family, which has a controlling stake of 57.7%. We do not deem any of the three INEDs effective, given their backgrounds. The purchase of an office building from a member of the controlling shareholder's family (an ED and the Chairman’s wife) in April 2019 is credit negative.

  We view Yuzhou Properties as “Medium Risk” on the LARA scale. The company has diversified outside Fujian province, with sizeable operations in the Yangtze River Delta Area (YRD). The company has a strong brand name in its home market Xiamen and key markets, including Hefei, Nanjing, Shanghai and Suzhou. We believe Yuzhou is well-positioned in those markets, as evidenced by the company's decent property sell-through rate. The brisk asset turnover boosts liquidity and cash reserves. That said, Yuzhou’s aggressive debt-funded expansion in both existing and new markets has stretched its credit metrics.   Our fundamental Credit Bias on Yuzhou is “Negative”. The company’s highly levered financial risk profile will likely remain stretched as it requires funding for construction and expansion. That said, contracted sales have been recovering from the COVID-19 pandemic's impact, and the expansion has been prudent so far in 2020. Nonetheless, we remain cautious on the company's appetite for expansion, given the aggressive sales target of CNY 100 bn this year. We like the geographical distribution of Yuzhou’s operations, as well as its sales execution and decent access to capital.   We view Yuzhou as “Weak” on the LAGA scale. All executive directors are from the Lam family, which has a controlling stake of 57.7%. We do not deem any of the three INEDs effective, given their backgrounds. The purchase of an office building from a member of the controlling shareholder's family (an ED and the Chairman’s wife) in April 2019 is credit negative. 

Yuzhou Group - Tear Sheet - Lucror Analytics