SEHK:1278

Stock Analysis Report

China New Town Development

Executive Summary

China New Town Development Company Limited engages in planning and developing new towns in the People's Republic of China.


Snowflake Analysis

Undervalued with acceptable track record.

Share Price & News

How has China New Town Development's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 1278's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-5.4%

1278

8.8%

HK Real Estate

5.3%

HK Market


1 Year Return

-35.6%

1278

-26.1%

HK Real Estate

-20.4%

HK Market

Return vs Industry: 1278 underperformed the Hong Kong Real Estate industry which returned -26.1% over the past year.

Return vs Market: 1278 underperformed the Hong Kong Market which returned -20.4% over the past year.


Shareholder returns

1278IndustryMarket
7 Day-5.4%8.8%5.3%
30 Day-7.5%-10.4%-8.5%
90 Day-18.0%-18.2%-14.7%
1 Year-33.3%-35.6%-22.9%-26.1%-17.6%-20.4%
3 Year-66.3%-68.9%17.0%4.3%-2.5%-12.3%
5 Year-61.9%-64.9%36.7%13.4%-5.7%-20.9%

Price Volatility Vs. Market

How volatile is China New Town Development's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is China New Town Development undervalued compared to its fair value and its price relative to the market?

38.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 1278 (HK$0.12) is trading below our estimate of fair value (HK$0.2)

Significantly Below Fair Value: 1278 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: 1278 is good value based on its PE Ratio (5.3x) compared to the Real Estate industry average (6.5x).

PE vs Market: 1278 is good value based on its PE Ratio (5.3x) compared to the Hong Kong market (9.1x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 1278's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 1278 is good value based on its PB Ratio (0.3x) compared to the HK Real Estate industry average (0.4x).


Next Steps

Future Growth

How is China New Town Development forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

11.1%

Forecasted Real Estate industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as China New Town Development has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has China New Town Development performed over the past 5 years?

25.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 1278 has a large one-off gain of CN¥76.0M impacting its June 30 2019 financial results.

Growing Profit Margin: 1278's current net profit margins (31.8%) are higher than last year (20%).


Past Earnings Growth Analysis

Earnings Trend: 1278 has become profitable over the past 5 years, growing earnings by 25.6% per year.

Accelerating Growth: 1278's earnings growth over the past year (11.6%) is below its 5-year average (25.6% per year).

Earnings vs Industry: 1278 earnings growth over the past year (11.6%) exceeded the Real Estate industry 2.4%.


Return on Equity

High ROE: 1278's Return on Equity (5.1%) is considered low.


Next Steps

Financial Health

How is China New Town Development's financial position?


Financial Position Analysis

Short Term Liabilities: 1278's short term assets (CN¥5.9B) exceed its short term liabilities (CN¥2.1B).

Long Term Liabilities: 1278's short term assets (CN¥5.9B) exceed its long term liabilities (CN¥2.3B).


Debt to Equity History and Analysis

Debt Level: 1278's debt to equity ratio (61.5%) is considered high.

Reducing Debt: 1278's debt to equity ratio has increased from 22.7% to 61.5% over the past 5 years.

Debt Coverage: 1278's debt is not well covered by operating cash flow (3.3%).

Interest Coverage: 1278's interest payments on its debt are not well covered by EBIT (0.3x coverage).


Balance Sheet

Inventory Level: 1278 has a low level of unsold assets or inventory.

Debt Coverage by Assets: 1278's debt is covered by short term assets (assets are 2.1x debt).


Next Steps

Dividend

What is China New Town Development's current dividend yield, its reliability and sustainability?

4.58%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 1278's dividend (4.58%) is higher than the bottom 25% of dividend payers in the Hong Kong market (2.56%).

High Dividend: 1278's dividend (4.58%) is low compared to the top 25% of dividend payers in the Hong Kong market (7.14%).


Stability and Growth of Payments

Stable Dividend: 1278 has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: 1278 has only been paying a dividend for 9 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (24.8%), 1278's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

6.1yrs

Average management tenure


CEO

Heqiang Liu (49yo)

6.08s

Tenure

CN¥1,205,000

Compensation

Mr. Heqiang Liu has been the Chief Executive Officer and Executive Director at China New Town Development Company Limited since March 28, 2014. Mr. Liu has been General Manager of Direct Investment Divisio ...


CEO Compensation Analysis

Compensation vs Market: Heqiang's total compensation ($USD170.15K) is below average for companies of similar size in the Hong Kong market ($USD301.13K).

Compensation vs Earnings: Heqiang's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Heqiang Liu
CEO & Executive Director6.08yrsCN¥1.21mno data
Bing Shi
Executive Director3.67yrsCN¥709.00kno data
Meiyu Yang
Executive Director6.08yrsCN¥1.05mno data
Xiaowei Ren
Executive Director6.08yrsCN¥1.03mno data
Jubo Wu
Chief Financial Officer5.08yrsno datano data
Hui Yipeng
General Manager of Operation Management Departmentno datano datano data
Yonggang Yang
Head of Legal Affairs for China and Vice Presidentno dataCN¥921.00kno data
Cheng Lucy
Company Secretary0.083yrno datano data
Yiping Mao
Vice President12.42yrsCN¥1.55mno data
Tai Lin
Vice President and Co-General Manager of Hotel & Golfno datano datano data

6.1yrs

Average Tenure

49.5yo

Average Age

Experienced Management: 1278's management team is seasoned and experienced (6.1 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Heqiang Liu
CEO & Executive Director6.08yrsCN¥1.21mno data
Bing Shi
Executive Director3.67yrsCN¥709.00kno data
Meiyu Yang
Executive Director6.08yrsCN¥1.05mno data
Xiaowei Ren
Executive Director6.08yrsCN¥1.03mno data
Yao Min Li
Non-Executive Vice Chairman6.08yrsCN¥675.00k0.086% CN¥1.0m
Song Kok Tan
Lead Independent Non-Executive Directorno dataCN¥380.00k0.0062% CN¥73.8k
Siu-Chee Kong
Independent Non-Executive Director13.42yrsCN¥334.00kno data
Yap Hock Eng
Independent Non-Executive Director7.92yrsCN¥219.00kno data
Hao Zhang
Independent Non-Executive Director8.17yrsCN¥278.00kno data
Kun Zuo
Chairman1.08yrsno datano data

6.1yrs

Average Tenure

52yo

Average Age

Experienced Board: 1278's board of directors are considered experienced (6.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

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.


Top Shareholders

Company Information

China New Town Development Company Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: China New Town Development Company Limited
  • Ticker: 1278
  • Exchange: SEHK
  • Founded: 2002
  • Industry: Real Estate Development
  • Sector: Real Estate
  • Market Cap: HK$1.196b
  • Shares outstanding: 9.73b
  • Website: https://www.china-newtown.com

Number of Employees


Location

  • China New Town Development Company Limited
  • 8203B-04A, International Commerce Centre
  • 1 Austin Road West
  • Yau Ma Tei
  • Kowloon
  • Hong Kong

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
1278SEHK (The Stock Exchange of Hong Kong Ltd.)YesOrdinary SharesHKHKDNov 2007

Biography

China New Town Development Company Limited engages in planning and developing new towns in the People's Republic of China. It operates through Land Development, Urbanization Development, Property Leasing, and Others segments. The company provides land infrastructure development services; constructs ancillary public facilities; and invests in new town projects. It also offers property leasing and management, real estate and enterprise investment consultation, asset and fund management, investment and asset development, investment management, and engineering management services. The company was founded in 2002 and is based in Yau Ma Tei, Hong Kong. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 13:50
End of Day Share Price2020/04/01 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.