Logan Property : CICC Recommends Logan Property as One of the Top Picks And Raises Target Price to HK$12.22

[For Immediate Release]

CICC Recommends Logan Property as One of the Top Picks

And Raises Target Price to HK$12.22

China/Hong Kong, 19 January 2018 - In its latest research report, renowned investment bank CICC recommends Logan Property Holdings Company Limited ("Logan Property" or "the Group", HKEx stock code: 3380) as one of its top picks in its latest research report, with a target price HK$12.22, as CICC is positive about the Group's strong growth moment, lucrative dividend yield and attractive valuation. The revised target price represents 35% of upside potential in share price.

Thanks to Logan Property's ample quality land banks in Guangdong-Hong Kong-Macau Greater Bay Area, CICC believes the Group will deliver strong and sustainable sales growth. CICC expects the attributable contract sales for 2018 will reach RMB66 billion, representing a year-on-year growth of over 50%. In view of the huge amount of saleable resources on hand, CICC believes the Group will continue to deliver strong growth and will generate RMB100 billion of attributable contract sales in 2019 (representing a year-on-year growth of 52%), realizing its 2020 sales target a year ahead.

CICC also points out that Logan Property's ongoing margin improvements will push forward better earnings performance. The firm estimates the Group's gross profit margin to reach 34% to 35% in 2017 to 2019, supported by the intensive delivery of star projects in coming years. The firm expects Shenzhen Carat Complex project to achieve a gross profit margin of 40% and will contribute a share of approximately 30% of booked revenue in 2018.

CICC lifted its estimate of core net profit for 2018 by 23% to RMB7 billion on the increased pace of sales and delivery, and estimates that the core net profit will reach RMB10.1 billion in 2019 (a year-on-year growth of 44%). CICC makes Logan Property one of sector top picks and lifted target price by 15% to HK$12.22 (35% upside potential). CICC favor Logan Property due to its strong and sustainable growth, lucrative dividend yield (5.7/4.0x P/E for 2018/2019).

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