Understanding the Market | Chinese property stocks fell across the board today. Institutions say the real estate cycle is entering a deep-water phase, and the performance of real estate companies in the third quarter will continue to be under pressure
Chinese property stocks fell broadly today. As of the time of writing, Sunac China fell 3.85% to HKD 1.5; Ronshine China fell 3.31% to HKD 0.175; Seazen fell 2.19% to HKD 2.23; Greentown China fell 2.05% to HKD 8.59. HTSC released a research report stating that from a macro perspective, the current real estate cycle is entering a "deep water zone" as it grinds to a bottom, with a more optimistic view on the recovery pace of core cities represented by first-tier cities. From a strategic perspective, the risk digestion in the real estate chain sector may have been relatively sufficient, and high-quality companies are expected to benefit from improved performance expectations and the dual logic of leading companies advancing. Shenwan Hongyuan, on the other hand, expects that the performance of real estate companies in the third quarter will continue to be under pressure, mainly due to the continuous decline in sales since 2021 leading to a decrease in settlements; previous price cuts and promotions have impacted profit margins due to low current settlements. However, considering the government's requirement for the real estate industry to "stop the decline and stabilize," as well as the bottoming out of corporate profit margins and the clearing of impairments, it is comprehensively expected that the sector's performance is likely to experience weak recovery amid bottom oscillation in 2025-2026, and the performance differentiation among companies will further intensify
According to Zhitong Finance APP, domestic property stocks fell broadly today. As of the time of writing, Sunac China (01918) fell 3.85% to HKD 1.50; Ronshine China (03301) fell 3.31% to HKD 0.175; Seazen (01030) fell 2.19% to HKD 2.23; Greentown China (03900) fell 2.05% to HKD 8.59.
HTSC released a research report stating that from a macro perspective, the current real estate cycle is entering a "deep water zone" as it bottoms out, with a more optimistic view on the recovery pace of core cities represented by first-tier cities. From a strategic perspective, the risk digestion in the real estate chain sector may have been relatively sufficient, and high-quality enterprises are expected to benefit from improved performance expectations and the dual logic of leading companies advancing.
Shenwan Hongyuan, on the other hand, expects that the performance of real estate companies in the third quarter will continue to be under pressure, mainly due to the continuous decline in sales since 2021 leading to a decrease in settlements. Previous price cuts and promotions have impacted profit margins due to low current settlements. However, considering the government's requirement for the real estate industry to "stop falling and stabilize," as well as the bottoming out of corporate profit margins and the clearing of impairments, it is comprehensively expected that the sector's performance is likely to experience weak recovery amid bottom oscillation in 2025-2026, and the performance differentiation among enterprises will further intensify
