Ying Li: (S$0.138) 2Q16 dragged by higher profit share to NCI; sanguine outlook
- Ying Li's 2Q16 net profit tumbled 43.7% to Rmb5m, mainly dragged by higher profit share to minority interest.
- 1H16 earnings Rmb21.8m (+158.6%), 13% (1H15: 6.6%) of FY16 street estimate.
- 1H16 top line (+31.6%), buoyed by growth in property development (+77.6%) and rental income (+2.7%).
- Residential project Lion City Garden in Chongqing continues to see healthy demand.
- Three other commercial projects remains on schedule to be completed between this year up to 2021, which should bolster revenue visibility over the next five years.
- Chongqing's underlying demand for residential/commercial assets is underpinned by the continued rise in GDP growth of 10.6% in 1H16 (1H15: 6.7%), making it the top city in terms of growth, compared to the national average of 6.7%.
- At the current price, Ying Li is valued at an attractive 0.36x P/B.
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