HONG KONG, March 21 Chinese developer China
Resources Land Ltd and Longfor Property Co Ltd
both expressed cautiousness on the country's property
market on Friday and said they see more market volatility in
China's home price inflation slowed for the second straight
month in February, the latest sign of cooling in the country's
frothy property market, fuelling fears of defaults in the sector
after the collapse of Zhejiang Xingrun Real Estate amid tight
"We are cautiously optimistic now, more towards cautious
this year, while we were more optimistic last year," China
Resources Land chairman Xiangdong Wu told a press conference.
"I agree that the price hike last year was bigger than
expected...it's not good for a market to always remain hot. A
little cooling is good."
He added that the company, the fourth-largest listed Chinese
developer by enterprise value, may consider lowering price of
some projects that see high profit.
Beijing-based Longfor also said it is taking a more cautious
view on the property market in 2014 as it sees more market
volatility and "changing demand and supply dynamics" in the
future, and squeezing margins has now become an industry trend.
"Supply is big in the third and fourth-tier cities so there
is more pressure. Our focus this year is to clean up the
inventory we have so there may be some impact on margins,"
Longfor chief financial officer Wei Huaning told reporters.
The company said it will take a more open attitude towards
cooperation and joint venture opportunities to expand investment
"Joint ventures and partnerships can help lower risk and
capital pressure. We are working with onshore funds and talking
to insurers now," Wei said.
On Friday, China Resources Land said its 2013 core net
profit jumped 30 percent to HK$9.4 billion ($1.21 billion),
while its net profit rose 39 percent to HK$14.7 billion, beating
analysts median forecast of HK$9.9 billion polled by Thomson
Longfor's net profit last year was 8 billion yuan ($1.28
billion), up 27 percent from a year earlier. It was forecast to
post a net profit of 6.4 billion yuan. Core profit was 6.2
Smaller peer Poly Properties, an overseas unit of
Poly Real Estate Group, says net profit rose 3.3
percent to HK$2.7 billion, in line with expectations. Twelve
analysts have forecast the company to record a net profit of
($1 = 6.2275 Chinese yuan)
($1 = 7.7645 Hong Kong dollars)
(Reporting by Clare Jim; Editing by Matt Driskill)