Raise pigs and build cars? What is the proportion of the main business of listed real estate companies revealed? Make money by selling houses

Vanke is raising pigs across borders, raising 250,000 pigs in the first phase; Evergrande is building cars to fully compete with Tesla. From grain and oil to mineral water, from education to automobiles, since 2010, real estate companies have been thinking about changes and proposed "diversified" transformation.

How has the diversified business developed over the past 10 years? Is it shrinking or expanding? Narada Big Data Research Institute's large-scale listed real estate company research team surveyed 80 real estate companies, 78 of which disclosed the proportion of each business, 69 of which accounted for more than 80% of their main business, and 57 of which accounted for more than 90% of their main business. .

Although some real estate companies have shouted that diversified businesses have "spread out", the road ahead will be difficult when switching tracks. Judging from the trend, only 33 real estate companies saw a decrease in their main business proportions compared with the same period last year, while 43 real estate companies saw a year-on-year increase in their main business proportions. Real estate development and sales remain the core driving force for corporate development.

Through sorting out the information in the semi-annual reports of real estate companies, we found that the coordinated development of making the main business bigger and stronger and diversified will become an important means for real estate companies to enhance their comprehensive competitiveness in the future.

Making money depends on selling houses!

The main business of 57 real estate companies accounts for more than 90%

In 2016, Evergrande Real Estate Group Co., Ltd. changed its name to "China Evergrande Group". After that, the real estate industry set off a wave of name changes. wave. Real estate companies are “de-real estate” one after another, accelerating the pace of transformation. However, switching tracks has a tough road ahead.

The main business of listed real estate companies mainly refers to real estate development and sales. ,

Among the 78 real estate companies counted by Nandu Big Data Research Institute, 57 have a main business ratio of more than 90%, 12 have a main business ratio of 80-90%, and 9 have a low main business ratio. At 80.

Ruian Real Estate’s real estate development and sales business accounted for the lowest proportion, only 14, compared with 81 in the same period last year. Shui On Real Estate, backed by Shanghai, has always focused on commercial properties. As of June 30, 2020, the group's revenue in the first half of the year fell by 8.2 to 1.45 billion yuan, of which property sales fell by 9.7 to 161 million yuan, property investment revenue fell to 1.003 billion yuan, construction business fell to 116 million yuan, and other income fell to 127 million yuan. 100 million. It can be seen that due to the impact of the epidemic, Shui On's overall revenue has declined, and the real estate development and sales segment has experienced the largest decline.

Researchers believe that from a single real estate to diversification, and then to focusing on the main business, although exploring diversified businesses has become common sense in the industry, in terms of "earning ability", real estate development and sales are still the most important. The core driving force for the development of real estate enterprises.

Diversified businesses "spread out"

The proportion of the main business of 33 real estate companies decreased

From the trend, the main business of 33 real estate companies The proportion has declined compared with the same period last year, indicating that the diversified layout of some real estate companies has begun to show results. It is worth noting that leading real estate companies have achieved success in diversifying their business layout. For example, the main business proportions of Country Garden, Vanke, Sunac, Greenland, Longfor, and China Resources decreased by 0.1, 0.37, 1.1, 0.16, 0.23, and 11.91 respectively.

Taking China Resources as an example, real estate development revenue in the first half of the year was 35.97 billion yuan, a decrease of 1.7% from the same period last year. Investment properties include shopping mall rental income of 3.91 billion yuan, a decrease of 8.9% compared with the same period last year; rental income of office buildings is 730 million yuan, an increase of 5.8% year-on-year; hotel business turnover is 350 million yuan, a decrease of 51.2% compared with the same period last year.

China Resources’ semi-annual report pointed out that it is positioned as an “urban comprehensive investment, development operator”, actively promotes innovative businesses that synergize with its main business, continuously improves regional overall development capabilities, and cultivates new business models and profits for future sustainable growth. growth point. Among them, property services were spun off and listed in the first half of the year. Investment properties represented by shopping malls are the group's key business sector, and the next two to three years will still be the peak period for new shopping malls to be put into operation.

There is also Agile. At the interim results conference, Chen Zhuolin, chairman of the board of directors and president, stated, "I firmly believe that diversification has blossomed." Not long after the conference, Agile achieved its full-year goal of 46 , also officially announced the strategic layout, which will be upgraded from "real estate as the main business with diversified businesses in parallel" to focusing on the main real estate business and coordinated development of related businesses to build a "135" concentric diversified strategic layout with large real estate as the core. “135” concentric and diversified strategic upgrade.

According to Chen Zhuolin’s expectation, in the next few years, the profit contribution of Agile’s diversified businesses will reach half.

Country Garden has also taken the initiative to adjust its development strategy and established a new development goal of "a high-tech comprehensive enterprise that creates better life products for the world", while consolidating its real estate development business with new urbanization as its core. , actively extending its business boundaries and laying out the two major development directions of robots and modern agriculture. For example, the world's first unmanned farm of over 10,000 acres demonstrates the latest achievements, and advanced unmanned operations are showing their talents in China's large granaries.

Small and medium-sized real estate companies expand their main business

The proportion of the main business of 43 real estate companies increased year-on-year

In addition, the proportion of the main business of 43 real estate companies increased year-on-year There was an increase, among which Sansheng had the highest increase. 2 were basically the same as last year.

It is worth noting that in the list of companies with year-on-year growth, leading real estate companies account for very little. The only real estate companies with sales of more than 200 billion yuan are Xincheng, China Overseas, China Merchants, Shimao, and Greentown, as well as Jinke and Zhongnan, which will hit 200 billion yuan in 2020.

Taking China Shipping as an example, as of the first half of the year, property development revenue was 86.35 billion yuan, a year-on-year increase of 11.2%, rental income from investment properties was 1.92 billion yuan, a year-on-year increase of 6.2%, and revenue from hotels and other commercial properties was 110 million yuan. Yuan, a year-on-year decrease of 42. The comprehensive impact was that the proportion of main business in the first half of the year increased slightly by 0.17 year-on-year. However, China Shipping also mentioned in its semi-annual report that it actively embraces changes, innovates business models, and accelerates the cultivation of new growth points, including new businesses such as elderly care, education, and logistics. A new supply chain management company was established in the first half of the year, aiming to integrate the advantageous resources of centralized material procurement and create a B2B building materials transaction and comprehensive service platform for the entire industry; a newly established technology company will focus on digital management and intelligent management of residential development and commercial operations. Provide technology products and services in real estate development and operation scenarios such as communities, smart homes, and smart commercial buildings, invest in upstream and downstream technology companies, and establish a technology ecosystem.

There is also Shimao, which has officially changed its name. In the first half of the year, its revenue was 64.553 billion yuan, an increase of 14.1% year-on-year. 95.2% of the revenue came from property sales, and 4.8% of the revenue came from hotel operations, commercial operations, property management and other businesses. The proportion of main business increased year-on-year, mainly because property sales increased from 53.2 billion yuan last year to 61.4 billion yuan, while hotel revenue fell sharply from 99.6 billion yuan to 45.3 billion yuan. In 2020, the diversified business development model of the "Big Aircraft Strategy" will be launched, with property development as the core subject; commercial operations, hotel operations, property management and finance as the solid wings; and high-tech, medical, education, senior care, culture and other investments as the core. Balanced development of key rear wings.

Of course, the proportion of main business has increased. Taking into account that the property investment business such as hotels and shopping malls have been greatly affected during the epidemic, this has also indirectly led to a slight fluctuation in this data.

Industry Observation:

Diversified new track, business contribution is expected to continue to grow

Diversification is no longer a new word. From the early grain and oil, mineral water, education, logistics, etc., to the current automobile, pig farming, duty-free shops and other industries, from long-term rental apartments and elderly care services to green finance and robots, real estate companies have created second growth points.

The diversified layout of real estate companies is mainly divided into two categories. One is the diversification around the main business, such as property services, long-term rental apartments, characteristic towns, cultural tourism real estate, logistics real estate, senior care real estate, etc., as The extension of real estate development by real estate companies can be deployed according to the trend, and it has stable income, so the participation is relatively high.

The second is, where is the outlet and where is the investment. For example, Evergrande crosses over into new energy vehicles, Country Garden crosses over into agriculture and robotics, and Vanke establishes a food division. Of course, there are still a small number of real estate companies that have basically transformed from property sales as their main business due to the difficulty of obtaining land and financing.

From single real estate, to diversification, and then to focusing on the main business, after ten years of stumbling exploration, real estate companies have gradually found a unique diversified business that suits them. The popularity of cross-border businesses has begun to decline. Vanke, for example, has recently made it clear that it must “converge its focus and consolidate and improve its fundamentals.”

Judging from the results, the diversified layout of many real estate companies has been "spreading out". The most prominent manifestation is that property companies have spun off and gone public, establishing a good reputation and adding new properties during the epidemic. Profit point. However, we have to admit that in the transformation strategies of most real estate companies, the revenue contribution ratio of diversified businesses is still very low.

As market competition becomes increasingly fierce, the coordinated development of bigger and stronger main businesses and diversification will become an important means for real estate companies to enhance their comprehensive competitiveness. It is foreseeable that the contribution of the diversified businesses of most companies to revenue will continue to grow in the future.

Planner: Lin Guang

Leader: Wang Yanling

Researchers: Wang Yanling, Lin Guangyi, Xiaoxia, Qiu Yongfen, Li Meiyu, Huang Lu

Nandu Big Data Research Produced by the institute’s research group on listed real estate companies