ChinaScope Daily Dim Sum

Thursday, May 10, 2012

Greentown Sales Value CNY 3.67bn in April, Country Garden CNY 9.1bn in Jan-Apr

Source: Company Disclosure, Company Disclosure, ChinaScope Financial (Data)

+ Greentown China reported that 809 units or 220,000 square meters were sold in April, with sales value of CNY 3.67 billion (including CNY 920 million subscription sales value), up 193% year-on-year.

+ Country Garden reported that the contracted sales value was CNY 9.1 billion during the Jan-Apr period, with contracted sales area of 1.47 million square meters. The company’s sales value dropped 13.8% in April.

Greentown (3900.HK) and Country Garden (2007.HK) both posted year-on-year declines in cumulative sales in the first 4 months this year. Greentown cut its average sales price to increase sales volume. By contrast, Sunac (1918.HK) realized dramatic year-on-year sales growth in the first 4 months.

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China’s Gold Imports Increase Rapidly in Q1

Source: National Business Daily, ChinaScope Financial (Data)

+ Data from the Census and Statistics Department shows that gold exports and re-exports from Hong Kong to mainland China was 135,529 kg in the first quarter of this year, a significant increase from 19,729 kg in the same period of last year. The figure was 62,907 kg in March, up 59% month-on-month.

+ The World Gold Council predicts that in 2012 China will take over India and become the world’s largest gold consumer. In 2011, the aggregate gold demand in India was 933.4 metric tons, while it was 769.8 tons in China.

Gold demand is increasingly driven by investment. The total gold demand growth is on a decline.

Despite the recent decline, domestic output can still not meet the consumer demand, why import is increasing.

55 Million New Credit Cards Issued in 2011

Source: China Business News, ChinaScope Financial (Data)

+ According a recent report released by the China Banking Association, there were 55 million new credit cards issued in China in 2011. In the same year, a total of 285 million credit cards were issued, up 24.3% year-on-year. Transaction volume amounted to CNY 7.56 trillion, up 47.95% year-on-year.

+ Unpaid debt by credit card owners was CNY 812.96 billion in 2011, up 81% year-on-year. Of this number, debt exceeding six months was CNY 11.03 billion, a year-on-year increase of 43.5%.

Credit cards and line of credit have grown steadily in recent years, supported by increasing in banks’ credit commitments. Meanwhile the percentage of overdue credits is declining.

Wednesday, May 9, 2012

ZHOU Hongyi: Qihoo 360 to Launch Own-brand Cell Phone

Source: Sina, ChinaScope Financial (Data)

+ ZHOU Hongyi, chairman of Qihoo 360 Technology Co. Ltd. disclosed on May 4 that his company will cooperate with mobile phone producers to develop an OEM phone under the 360 brand, targeting low-end market users.

+ Qihoo 360 hopes its partner will provide users with high-level configuration smart phones at zero profit.

+ Qihoo 360 is producing a very popular anti-virus software, which the company hopes to publicize further with the phone launch.

About 70% of Chinese internet users enjoy mobile access.

360 Phone is planning on entering the 1000-1500 segment, which has been growing in the last part of 2011.

The high overall installation rate compared with the low pre-installation rate, shows the popularity of the 360 antivirus software. The 360 phone launch is expected to further increase the overall installation rate.

Currently Qihoo does not generate much revenue from mobile security products. The revenue composition of Net Qin, however, indicates that the mobile antivirus software market has great revenue generation potential.

Trading Comparables

3G Users to Exceed CNY 450 Million in 2015

Source: Ministry of Industry and Information Technology, ChinaScope Financial (Data)

+ According to the Ministry of Industry and Information Technology’s (MIIT) development goal in the recently released 12th Five-Year Plan (12th 5YP) on the Telecommunications Industry, China’s 3G users will exceed 450 million by 2015, accounting for more than 36% of the total mobile phone subscribers.

+ The plan also outlines a revenue goal for the telecommunication industry of CNY 1.5 trillion. Of this amount, operating income of telecom companies engaged in infrastructure construction is expected to be more than CNY 1.1 trillion. Fixed Asset Investment goal is CNY 2 trillion.

Despite rapid growth in recent years, 3G subscribers still account for only about 15% of total mobile phone subscribers.

In the 12^th 5 year plan, both telecommunication revenue and FAI are expected to grow significantly.

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Evergrande Real Estate: Sales Revenue CNY 8.19 Billion in April, Up 33.1% YoY

Source: Company Disclosure, ChinaScope Financial (Data)

+ Evergrande Real Estate Group Ltd. announced on May 7 that the company made CNY 8.19 billion in contracted sales revenue this April, up 33.1% year-on-year and 103.5% month-on-month. Meanwhile, contracted sales area reached 1.38 million square meters, up 57.8% year-on-year and 126.4% month-on-month.

+ According to Evergrande, stronger sales campaign efforts have led to the performance improvement. In April, the company launched seven new projects, raising the number of sale projects to 143.

Evergrande (3333.HK) realized significant month-on-month sales value growth in April 2012. In year-on-year terms Jan-April cumulative sales value decreased for Evergrande and increased for other developers. All companies have seen declining average sales prices.

Wednesday, May 2, 2012

Air China’s Net Profit CNY 239 Million in Q1, Down 85% YoY

Source: Air China Ltd., ChinaScope Financial (Data)

+ Air China Ltd. released its first-quarter financial report on April 26, showing that net profit attributable to shareholders of the listed company was CNY 239 million, down 85.70% year-on-year in Q1.

+ Due to higher jet fuel prices, Air China’s net profit attributable to shareholders of the parent company went down by CNY 1.43 billion year-on-year. In addition, foreign exchange gains and investment returns also decreased year-on-year.

+ The company also announced a private placement plan, which aims to raise CNY 1.05 billion via shares selling to the controlling shareholder China National Aviation Holding Company (CNAH). CNY 1 billion of the raised amount will be used for two energy-saving projects and for repaying bank loans used when the company increased its holdings in Cathay Pacific Airways.

Both revenue growth and margins are dismal.

Key operation data indicated a weak trend of Air China’s revenue in 2012.