In a Friday report, analyst Andy Wong says he has opted to adopt a more conservative stance to project contracted sales of RMB35.2 billion for 2019, versus the management’s guidance of about RMB40 billion on expectations of more abundant saleable resources.
This is in view of volatile market conditions and uncertainties surrounding pre-sale permits given by local governments, says Wong.
Further, the analyst is cautious of the group’s high net gearing ratio, which stood at 96.8% as at end-FY18, up from 91.2% a year ago.
“Management acknowledged once again that this was on the high-side relative to historical levels, and thus has an aim on being more prudent on its land acquisitions this year. Coupled with cash inflows from more project launches, Yanlord is hopeful of bringing down its net gearing ratio by end-2019. We cut our FY19 core PATMI forecasts by 15.6% and introduce our FY20 projections,” he adds.
As at 4.08pm, shares in Yanlord are down by 1 cent at $1.38, or 0.5 times FY19F book value.
