Perspectives
2013 Mainland property companies' performance and market outlooks
Since 2012, the real estate industry in China has been performing better, as there have been increases in both the sales of houses and their prices.
Deloitte China Real Estate Industry launched the new thought leadership piece 2013 Mainland property companies' performance and market outlooks. The study compared the financial data of 174 property companies listed in Shanghai, Shenzhen and Hong Kong in 2012 against that of 168 companies in the previous year. There were also in-depth interviews with the management of certain major market players.
Despite the increase in the companies' average total revenue, nearly 60 percent of listed mainland real estate companies recorded a decline in net profit margin during 2012, reflecting the beginning of profitability down cycle in light of tight policy environment and easing economic growth.
In comparison with their counterparts in Shenzhen and Shanghai, real estate companies listed in Hong Kong fared up better in terms of their market capitalisation, reflecting the better performance in Hong Kong's stock market bolstered in part by global quantitative monetary easing policies. Meanwhile, real estate companies listed in Hong Kong also showed a better average net profit margin, which is indicative of their higher portfolio composition in investment properties.