Equity Analysis /
Hong Kong

HK : Yuzhou Group - Dampened profitability

    Raymond Cheng
    Raymond Cheng

    Head of Hong Kong Research

    12 April 2021
    Published byCGS-CIMB

    Yuzhou Group’s FY20 results were disappointing, with a 81% yoy decline in core net profit, primarily due to margin erosion. It targets only a 5% yoy growth in contracted sales in FY21F as it spent less on land acquisition last year. We believe its gross margin would continue to come under pressure for some time due to price controls and high land cost. Downgrade to Hold.