China Evergrande 3333

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*DJ Evergrande Prices IPO At HK$3.5/Shr; Middle Of Range - Source


From Dow Jones Newswire

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Guangzhou-based developer Evergrande Real Estate is expected to raise HK$5.65 billion from its initial public offering because of robust demand from retail and institutional buyers.

The developer plans to price its 1.61 billion IPO shares at HK$3.50 apiece - the middle of its indicative range - after its retail tranche was oversubscribed 47 times.

The international portion was covered 11 times, sources said.

Source: The Standard HK

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Applied.

MARKET TALK: Evergrande May Rise 10%-20% On Debut - OSK Sec

Source: Dow Jones Newswire

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Applied.

Developer may be `richest' by Mandy Lo, The Standard HK

Evergrande Real Estate (3333) chairman Hui Ka-yan and his wife may have become the mainland's richest couple after the firm's shares surged over 25 percent in the gray market yesterday.

The Huis have HK$44.89 billion worth of Evergrande shares based on the gray market's closing price.

With 10.2 billion shares, or a 68 percent percent stake, in the developer, the couple's wealth surpasses that of BYD (1211) chairman Wang Chuanfu who currently tops the Hurun Rich List with US$5.1 billion (HK$39.78 billion).

Evergrande jumped as much as 27.14 percent from its offer price of HK$3.50 to HK$4.45 before closing at HK$4.40 in pre-debut trade, making it the best performing property IPO this year, according to Phillip Securities.

Shareholders posted a paper gain of HK$900 per board lot of 1,000 shares. Turnover reached HK$120 million with 29.56 million shares changing hands.

The retail portion of Evergrande was 44.72 times oversubscribed.

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DJ MARKET TALK: Evergrande May Rise On Debut;Grey Mkt Ends +25.7%

0901 [Dow Jones] NEW LISTING: Evergrande Real Estate (3333.HK) may rise on debut, after gray market price ended +25.7% at HK$4.40 vs IPO price of HK$3.50 (based on PhillipMart).

Rise of mid-sized China-based property developer's grey market price may be due to low pricing. KGI says offer price represents 45.4X FY09 P/E, but notes market estimates it will fall to 5.5X in FY10, without elaborating.

Notes, Evergrande has attracted 2 cornerstone investors, Chinese Estates (0127.HK) and Chow Tai Fook Group to subscribe to offer shares equal to amount of US$50 million each with lock-up period of 6 months, which can enhance investors' confidence.

Company forecasts FY09 net profit attributable to shareholders before revaluation gains at CNY417 million vs CNY1.033 billion after the gains. Lukewarm response with its retail book 45X oversubscribed, triggering clawback which raises retail tranche to 30% from 10% originally.

Source: Dow Jones Newswire

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DJ MARKET TALK: Evergrande +14.3% Pre-Mkt; May Test HK$4.45

0956 [Dow Jones] NEW LISTING: Evergrande (3333.HK) +14.3% at HK$4.00 at pre-open, vs IPO price of HK$3.50, may test peak of grey market of HK$4.45 later.

KGI notes, Evergrande has largest land reserves among China property developers, with total GFA of about 51.2 million sq m, average cost of approximately CNY445/sq m.

"Current land reserve can support development in the next 3-5 years, the group will focus on low-cost land reserves." Expects GFA under construction will be maintained at around 15 million sq m each year.

Source: Dow Jones Newswire

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DJ MARKET TALK: BOCI Starts Evergrande Buy; Super-Efficient Model
December 11, 2009

1412 [Dow Jones] STOCK CALL: BOCI starts Evergrande Real Estate (3333.HK) at Buy, target price of HK$6.10 pegged on 15% NAV discount; says with "super-efficient," standardized operational model for large-scale quality projects, Evergrande expanded exposure from Guangzhou to 24 cities nationwide.

Company successfully creating valuable brand name outside Guangzhou by providing value-for-money flats through strong execution capability, low-cost advantage; also enabled it to raise funds, continue its expansion amid global financial tsunami last year.

With increasing completion rate for 51.2 million sqm land bank, expects Evergrande to achieve stellar underlying earnings CAGR of 315% during 2008-10.

Source: Dow Jones Newswire

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Not vested.

DJ MARKET TALK: BoA-ML Starts Evergrande At Buy; Top Pick
December 10, 2009

1104 [Dow Jones] STOCK CALL: Bank of America-Merrill Lynch says Evergrande (3333.HK) its top pick in China property sector for 2010, starts stock at Buy with target HK$6.00.

"We believe Evergrande will be a key beneficiary of the Chinese government's focus on domestic consumption and urbanization in Tier-2/3 cities." Sees Evergrande as a proxy to China's residential property sector, which is on long term secular growth trend.

Expects strong volume and margin expansion to drive its earnings. Trading at 61% 2010/PE discount to peers, valuation is attractive.

Source: Dow Jones Nwswire

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Evergrande homes in on smaller cities

Evergrande Real Estate (3333) expects stable sales growth this year on strong demand for homes in second-tier cities in the mainland.

The developer yesterday said contracted sales jumped 402 percent to 30.3 billion yuan (HK$34.42 billion) last year. The gross floor area sold, 5.64 million square meters, was nearly five times more than in 2008.

Projects under construction amounted to 16.89 million square meters, while presale permits have been received for 7.79 million square meters.

Chief executive James Xia Haijun expects prices to fluctuate by 10 percent this year because of measures to cool the sector.

Amid reports Evergrande forfeited a 130 million yuan deposit it paid in an auction for a Guangzhou site, Xia said it is in talks to change the land use to commercial.

Evergrande shares fell 2.4 percent to HK$4.06 yesterday.

Source: MANDY LO, The Standard HK

http://www.thestandard.com.hk/news_deta ... 00106&fc=4

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Not vested. From Phillips:-


Risk

Sales will be lower than our expectation.

The company will pay amounts of costs of idle land for possible government's regulation on idle land.

And the local government will withdraw the parts of land which isn`t developed as schedule.

Financing cost may be affected by obvious changes of interest, and the company's sustaining operation may be affected by worsening financing surrounding.


Valuation

We maintain our estimation on the company's earnings in 2009-2010. We expect that Evergrande's profit in 2009 and 2010 will be RMB 1.186 billion and 3.206 billion, diluted EPS will be RMB 0.08 and 0.21 respectively, representing to HKD 0.09 and 0.24.

Considering policy risk in2010, uncertainty of sales and aggressive expanding policy, we are intend to give conservative valuation multiples to Evergrande. We give Evergrande 18x forecasted PE, 12m TP of HK$4.3, suggesting 9.97% up room from current close. We recommend a “Hold” rating.