BEIJING, June 6, 2013 /PRNewswire/ -- On June 6, Evergrande published a brief report on its sales performance in May, which showed that Evergrande achieved 9.21 billion yuan (RMB, hereinafter inclusive) of sales amount in May, up 26.9 percent month-on-month; and sales area totaled 1.286 million square meters, up 17.2 percent, ranking it the first within China. An original report by Sina Leju follows:
From January to May of this year, Evergrande accumulatively achieved 34.19 billion yuan of sales amount, up 27.5 percent year-on-year; and the accumulative sales area was 5.222 million square meters, up 18.6 percent year-on-year. Furthermore, since March, Evergrande has already achieved double-digit growth month-on-month for three consecutive months, despite not so favorable market conditions.
Both Sales Volume and Amount Increase, and Unit Price Exceeded Seven Thousand Yuan for the First Time
According to an analysis report released by the China Index Academy, since May, many policies that adjusted and controlled housing prices, such as the "Five National Rules," and rules for housing price limits have been gradually implemented, causing many developers to delay launching new housing projects and some buyers to wait and see what the housing market development trend will be. Therefore, the housing turnover of several cities kept reducing month-on-month, and under the dual influences of strict policies and reducing turnover, the sales amount and volume in May were not as favorable as those in May of previous years.
Depending on its sales strategy of "fluctuating in line with market conditions," Evergrande scientifically controlled the sales rhythm and rationally adjusted the number of new housing projects so that it could maintain a fast and stable growth during such a downturn, and could achieve double-digit growth in sales amount and areas month-on-month for three consecutive months.
While it further solidified and expanded its market share, Evergrande also had its average unit price exceed 7,000 yuan in a single month for the first time, and achieved increase in sales volume and amount for three consecutive months since March. According to the earlier report, the average unit price of Evergrande in May was 7,163 yuan per square meters, up 8.2 percent month-on-month; and the average unit price from January to May of this year was 6,548 yuan per square meters, up 7.5 percent year-on-year.
Sales Amount Hikes Almost 30%, Evergrande's Sales Target is Expected to be Achieved
Previously, Haitong International released a report showing the current price-earnings ratio of the real estate industry reaching as low as 5.1 times, which is much less than 9.2 times, the average level since 2007. Therefore, enterprises that are less influenced by the housing policies, including developers that focus on the market with rigid demands, enterprises that emphasize on developing real estate markets in 2nd and 3rd-tier cities, developers of commercial properties, enterprises with a healthy debt condition, enterprises with an attractive value of assessment, and other enterprise shares in the third category with similar conditions will have optimistic shares that will be recommended by the market.
In addition, Evergrande continues to deeply develop housing projects in 2nd and 3rd-tier cities with strong rigid demand, launch products with high cost performance to meet the demand of the market and policies, and pursue small profits but quick turnover, so as to cope with rigid demand. Recently, Haitong International issued a buy rating for Evergrande, saying that "Evergrande focuses on markets with rigid demand, so that its level of products leads among its peers, and the ratio of its projects developed in 3rd-tier cities is high. Therefore, its value of assessment is attractive." To sum up, the condition for Evergrande to achieve its sales target in 2013, namely 100 billion yuan of sales amount, is optimistic.
SOURCE Sina Leju