SEHK:1109

Stock Analysis Report

Executive Summary

China Resources Land Limited, an investment holding company, invests in, develops, manages, and sells properties in the People’s Republic of China.

Rewards

Trading at 15.4% below its fair value

Earnings are forecast to grow 13.16% per year

Earnings grew by 17% over the past year

Risk Analysis

Has a high level of debt

Unstable dividend track record

Large one-off items impacting financial results



Snowflake Analysis

Excellent balance sheet with reasonable growth potential and pays a dividend.


Similar Companies

China Overseas Land & Investment

SEHK:688

Share Price & News

How has China Resources Land's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 1109 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.7%

1109

-4.2%

HK Real Estate

-3.1%

HK Market


1 Year Return

19.5%

1109

3.5%

HK Real Estate

2.3%

HK Market

Return vs Industry: 1109 exceeded the Hong Kong Real Estate industry which returned 6.7% over the past year.

Return vs Market: 1109 exceeded the Hong Kong Market which returned 6.4% over the past year.


Shareholder returns

1109IndustryMarket
7 Day-2.7%-4.2%-3.1%
30 Day-4.0%-1.6%0.5%
90 Day6.6%6.1%5.3%
1 Year24.2%19.5%8.2%3.5%6.1%2.3%
3 Year106.2%86.2%53.1%36.8%22.2%9.8%
5 Year97.8%69.5%65.4%37.3%18.0%-1.7%

Price Volatility Vs. Market

How volatile is China Resources Land's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is China Resources Land undervalued compared to its fair value and its price relative to the market?

14.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 1109 (HK$36.6) is trading below our estimate of fair value (HK$43.24)

Significantly Below Fair Value: 1109 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: 1109 is poor value based on its PE Ratio (8x) compared to the Real Estate industry average (6.9x).

PE vs Market: 1109 is good value based on its PE Ratio (8x) compared to the Hong Kong market (10.5x).


Price to Earnings Growth Ratio

PEG Ratio: 1109 is good value based on its PEG Ratio (0.6x)


Price to Book Ratio

PB vs Industry: 1109 is overvalued based on its PB Ratio (1.5x) compared to the HK Real Estate industry average (0.5x).


Next Steps

Future Growth

How is China Resources Land forecast to perform in the next 1 to 3 years based on estimates from 24 analysts?

13.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 1109's forecast earnings growth (13.2% per year) is above the savings rate (1.6%).

Earnings vs Market: 1109's earnings (13.2% per year) are forecast to grow faster than the Hong Kong market (11.3% per year).

High Growth Earnings: 1109's earnings are forecast to grow, but not significantly.

Revenue vs Market: 1109's revenue (20.7% per year) is forecast to grow faster than the Hong Kong market (10.2% per year).

High Growth Revenue: 1109's revenue (20.7% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 1109's Return on Equity is forecast to be low in 3 years time (16.7%).


Next Steps

Past Performance

How has China Resources Land performed over the past 5 years?

17.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 1109 has a large one-off gain of CN¥11.8B impacting its June 30 2019 financial results.

Growing Profit Margin: 1109's current net profit margins (22.8%) are higher than last year (21%).


Past Earnings Growth Analysis

Earnings Trend: 1109's earnings have grown by 17.2% per year over the past 5 years.

Accelerating Growth: 1109's earnings growth over the past year (17%) is below its 5-year average (17.2% per year).

Earnings vs Industry: 1109 earnings growth over the past year (17%) exceeded the Real Estate industry -9.9%.


Return on Equity

High ROE: 1109's Return on Equity (16.4%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is China Resources Land's financial position?


Financial Position Analysis

Short Term Liabilities: 1109's short term assets (CN¥505.7B) exceed its short term liabilities (CN¥385.2B).

Long Term Liabilities: 1109's short term assets (CN¥505.7B) exceed its long term liabilities (CN¥151.8B).


Debt to Equity History and Analysis

Debt Level: 1109's debt to equity ratio (78.2%) is considered high.

Reducing Debt: 1109's debt to equity ratio has reduced from 81.1% to 78.2% over the past 5 years.

Debt Coverage: 1109's debt is well covered by operating cash flow (31.8%).

Interest Coverage: 1109 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: 1109 has a high level of physical assets or inventory.

Debt Coverage by Assets: 1109's debt is covered by short term assets (assets are 3.4x debt).


Next Steps

Dividend

What is China Resources Land's current dividend yield, its reliability and sustainability?

3.44%

Current Dividend Yield


Dividend Yield vs Market

company3.4%marketbottom25%2.2%markettop25%6.2%industryaverage4.3%forecastin3Years4.6%

Current dividend yield vs market & industry

Notable Dividend: 1109's dividend (3.36%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.17%).

High Dividend: 1109's dividend (3.36%) is low compared to the top 25% of dividend payers in the Hong Kong market (6.02%).


Stability and Growth of Payments

Stable Dividend: 1109's dividend payments have been volatile in the past 10 years.

Growing Dividend: 1109's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (26.6%), 1109's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 1109's dividends in 3 years are forecast to be well covered by earnings (35% payout ratio).


Next Steps

Management

What is the CEO of China Resources Land's salary, the management and board of directors tenure and is there insider trading?

3.5yrs

Average management tenure


CEO

China Resources Land has no CEO, or we have no data on them.


Management Age and Tenure

3.5yrs

Average Tenure

48yo

Average Age

Experienced Management: 1109's management team is considered experienced (3.5 years average tenure).


Board Age and Tenure

2.8yrs

Average Tenure

51yo

Average Age

Experienced Board: 1109's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Ji Xie (47yo)

    Senior VP & Executive Director

    • Tenure: 2.8yrs
    • Compensation: CN¥8.67m
  • Xin Li (48yo)

    President & Executive Director

    • Tenure: 2.8yrs
    • Compensation: CN¥9.12m
  • Eva Lau

    Investor Relations Manager

    • Dawei Zhang (51yo)

      Vice Chairman

      • Tenure: 1.1yrs
      • Compensation: CN¥9.37m
    • Feng Chi (46yo)

      Senior VP & Group GM of Jiangsu Region

      • Tenure: 6.6yrs
    • Bingqi Wu (47yo)

      Senior VP

      • Tenure: 0.9yrs
    • Xiaokai Kong (50yo)

      Senior VP & GM of the South China Region

      • Tenure: 3.5yrs
    • Tongdong Shen (51yo)

      Chief Information Officer

      • Tenure: 1.1yrs
      • Compensation: CN¥1.28m
    • Liqiang Zhang (53yo)

      Senior VP & Chief Human Resources Officer

      • Tenure: 2.8yrs
    • Linkang Yu (47yo)

      Senior Vice President

      • Tenure: 1.1yrs

    Board Members

    • Andy Yan (62yo)

      Independent Non-Executive Director

      • Tenure: 13.5yrs
      • Compensation: CN¥303.00k
    • Biao Yan (57yo)

      Non-Executive Director

      • Tenure: 23.9yrs
    • Ji Xie (47yo)

      Senior VP & Executive Director

      • Tenure: 2.8yrs
      • Compensation: CN¥8.67m
    • Xin Li (48yo)

      President & Executive Director

      • Tenure: 2.8yrs
      • Compensation: CN¥9.12m
    • Bosco Ho (74yo)

      Independent Non-Executive Director

      • Tenure: 14.3yrs
      • Compensation: CN¥303.00k
    • Xiangming Wang (50yo)

      Chairman of the Board

      • Tenure: 0.08yrs
    • Peter Wan (66yo)

      Independent Non-Executive Director

      • Tenure: 10.8yrs
      • Compensation: CN¥303.00k
    • Dawei Zhang (51yo)

      Vice Chairman

      • Tenure: 1.1yrs
      • Compensation: CN¥9.37m
    • Bingqi Wu (47yo)

      Senior VP

      • Tenure: 0.9yrs
    • Tongdong Shen (51yo)

      Chief Information Officer

      • Tenure: 1.1yrs
      • Compensation: CN¥1.28m

    Company Information

    China Resources Land Limited's company bio, employee growth, exchange listings and data sources


    Key Information

    • Name: China Resources Land Limited
    • Ticker: 1109
    • Exchange: SEHK
    • Founded: 1996
    • Industry: Real Estate Development
    • Sector: Real Estate
    • Market Cap: HK$247.087b
    • Shares outstanding: 7.13b
    • Website: https://www.crland.com.hk

    Number of Employees


    Location

    • China Resources Land Limited
    • China Resources Building
    • 46th Floor
    • Wanchai
    • Hong Kong

    Listings

    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
    CRBJ.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 1996
    1109SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDNov 1996
    CHZDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 1996
    1109SHSC (Stock Exchange of Hong Kong Limited - Shanghai - Hong Kong Stock Connect)YesOrdinary SharesHKHKDNov 1996
    1109SZSC (The Stock Exchange of Hong Kong - Shenzhen - Hong Kong Stock Connect)YesOrdinary SharesHKHKDNov 1996
    1109 NBMV (Bolsa Mexicana de Valores)YesOrdinary SharesMXMXNNov 1996
    CRBJ.YOTCPK (Pink Sheets LLC)ADRUSUSDJan 2009

    Biography

    China Resources Land Limited, an investment holding company, invests in, develops, manages, and sells properties in the People’s Republic of China. It invests in commercial, office, hotel, and apartment properties. As of December 31, 2018, the company had land bank of 59.57 million square meters, including 50.14 million square meters for development properties and 9.43 million square meters for investment properties. It also operates hotels; offers construction, decoration, and other property development related services; and manufactures and sells furniture. The company was incorporated in 1996 and is headquartered in Wanchai, Hong Kong. China Resources Land Limited is a subsidiary of China Resources (Holdings) Company Limited. 


    Company Analysis and Financial Data Status

    All financial data provided by Standard & Poor's Capital IQ.
    DataLast Updated (UTC time)
    Company Analysis2020/01/22 12:34
    End of Day Share Price2020/01/22 00:00
    Earnings2019/06/30
    Annual Earnings2018/12/31


    Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.