Logan Property : 2017-08-17Logan Property Delivered Strong Interim Results BOCOM International and Nomura Raise Target Price to HK$8.68 and HK$8.40 Respectively

Logan Property Delivered Strong Interim Results BOCOM International and Nomura Raise Target Price to HK$8.68 and HK$8.40 Respectively

Datetime：[2017-08-17]

China/Hong Kong, 17August2017- In their latest research reports, renowned securities firms BOCOM International and Nomura consider that the interim results of Logan Property Holdings Company Limited ('Logan Property' or 'the Group', HKEx stock code: 3380) show vigorous growth. BOCOM International expects the Group's Shenzhen and other projects located within the Guangdong-Hong Kong-Macao Greater Bay Area ('the Greater Bay Area') to continue to benefit from the rising average selling price ('ASP') to deliver decent margins. It is positive about the prospect of Logan Property, thus maintaining its 'Buy' rating and raising the target price to HK$8.68. Nomura is positive about the outlook of urban renewal projects that the Group is participating, thus reiterating its 'Buy' rating, with the target price raised by as much as 53% to HK$8.40.

The Group's interim results beat market expectations and it surprised the market by declaring an interim dividend and a special dividend of HK$0.22 in total. BOCOM International points out that the delivery of star projects like Logan City will strongly lift the Group's profitability. Furthermore, the Group's projects in Shenzhen and within the Greater Bay Area will continue to benefit from the rising ASP, pushing the Group's gross profit margin to 33%-35% from 2017 to 2019. In view of the promising prospect for sales and revenue growth and the Group revised up its full-year sales target to RMB37 billion, BOCOM International expects Logan Property's contract sales to grow at a compound annual growth rate of 30% in the coming years and expects the Group to achieve RMB80 billion contract sales by 2020.

Nomura points out that Logan Property has for the first time disclosed details of the distribution of its redevelopment pipeline, and expects that the corresponding land bank for this redevelopment pipeline will drastically increase the Group's saleable resources by 66% to RMB388 billion, out of which majority is located in the Greater Bay Area which enjoys strong demand and rather high profitability, and such is expected to drive the Group's future sales.