UOB Kay Hian
Date of Report: August 26, 2025
Poly Property Services (6049 HK) Delivers Steady Growth Amid Industry Headwinds: Comprehensive 1H25 Performance Review & Outlook
Executive Summary: Resilient Growth and Efficiency for Poly Property Services
Poly Property Services (Poly PS), a leading Chinese property management company listed in Hong Kong, reported a solid set of results for the first half of 2025. Despite sector challenges, the company achieved steady revenue and profit growth, improved operational efficiency, and maintained a robust cash position. Management reaffirmed its full-year targets and continued to expand its footprint, especially in third-party contracts and public property management.
Company Overview
– Founded: June 1996, Guangzhou – Parent: Poly Development Holding Group – Sector: Real Estate – Shares Issued: 347.0 million – Market Cap: HK\$20,661.5m (US\$2,645.0m) – Ticker: 6049 HK – 52-week share price range: HK\$23.90 – HK\$39.35 – Target Price: HK\$42.60 (Upside: 13.9%) – Rating: BUY (Maintained)
1H25 Financial Performance: Key Highlights
Poly PS delivered in-line first-half results, with revenue up 6.6% year-over-year (YoY) and net profit up 5.3% YoY. Margins were impacted by a weaker performance in non-property-owner value-added services (VAS), but efficiency gains and cost control offset these pressures.
| Metric |
1H25 |
2H24 |
1H24 |
YoY Change |
HoH Change |
| Revenue (Rmbm) |
8,392 |
5,487 |
7,871 |
+6.6% |
+52.9% |
| Net Profit Attributable (Rmbm) |
904 |
628 |
846 |
+6.9% |
+44.0% |
| EPS (RMB/share) |
1.64 |
1.14 |
1.54 |
+6.5% |
+44.0% |
| Gross Profit Margin |
19.2% |
25.0% |
20.5% |
-1.3ppt |
-5.9ppt |
| SG&A/Revenue |
5.3% |
7.6% |
6.3% |
+0.9ppt |
+2.2ppt |
Segment Analysis: Mixed Performance Across Key Business Lines
- Property Management Services: Revenue up 13.1% YoY, gross margin slightly down by 0.2ppt to 16.6%.
- Community Value-Added Services (VAS): Revenue declined -3.7% YoY, but gross margin improved by 1.1ppt to 39.9% thanks to stronger retail and parking services.
- VAS to Non-Property Owners: Revenue fell sharply (-16.1% YoY) and gross margin contracted 6.8ppt to 11.2%, reflecting sector weakness, especially in real estate and office leasing.
Operational Efficiency: Cost Control and Receivables Management
- SG&A expenses declined 9.1% YoY; SG&A/revenue ratio improved to 5.3%.
- Accounts receivable turnover days increased to 80.5, up from 74.8 a year earlier, driven by longer collection cycles in public property management.
- Cash on hand remained solid at Rmb11.7b, down 1.8% HoH, with net cash per share at Rmb24.27.
Growth Drivers: Third-party Expansion and GFA Management
- Contracted Gross Floor Area (GFA) reached 996.1m sqm (+4.9% YoY), with managed GFA up 10.2% YoY to 833.7m sqm.
- Third-party contracts made up 63.8% of total contracted GFA, up 6% YoY.
- Value of newly signed third-party contracts surged 17.2% YoY to Rmb1,406.1m, highlighting the company’s expansion capability despite intense competition.
- Residential, commercial, and public service accounted for 13.9%, 36.3%, and 49.8% of new third-party contracts, respectively.
- 85% of newly-signed third-party contract value originated from top 50 core cities, up 5.1ppt over last year.
| Operation Data (mn sqm) |
Jun-24 |
Dec-24 |
Jun-25 |
HoH% |
YoY% |
| GFA under mgmt |
757 |
803 |
834 |
+4% |
+10% |
| From Poly Development |
266 |
278 |
284 |
+2% |
+7% |
| From Third Party |
491 |
525 |
550 |
+5% |
+12% |
| Contracted GFA |
950 |
988 |
996 |
+1% |
+5% |
Profitability & Financial Metrics: Stable Returns Amid Margin Pressure
| Year |
2024 |
2025F |
2026F |
2027F |
| Net turnover (Rmbm) |
16,342 |
17,456 |
18,707 |
20,112 |
| EBITDA (Rmbm) |
2,342 |
2,098 |
2,143 |
2,227 |
| Net profit (adj., Rmbm) |
1,475 |
1,555 |
1,606 |
1,667 |
| EPS (sen) |
266.8 |
281.3 |
290.7 |
301.6 |
| PE (x) |
12.8 |
12.2 |
11.8 |
11.3 |
| Dividend Yield (%) |
3.9 |
4.1 |
4.3 |
4.4 |
| Net Margin (%) |
9.0 |
8.9 |
8.6 |
8.3 |
| ROE (%) |
16.0 |
15.4 |
14.8 |
14.3 |
| Net Debt/(Cash) to Equity (%) |
(102.0) |
(128.0) |
(134.0) |
(140.9) |
Cash Flow and Balance Sheet: Strong Liquidity, No Debt
– Operating cash flow remained healthy, supporting expansion. – No short-term or long-term debt, maintaining a strong net cash position. – Dividend payments are consistent, with yields projected to rise slightly through 2027.
Management Outlook: 2025 Targets and Risks
– Management reiterated its 2025 guidance: 5% YoY growth in revenue, net profit, and newly signed GFA. – Risks to outlook include:
- Faster-than-expected wage growth for workers.
- Potential regulatory tightening in the property management sector.
– No interim dividend was declared for 1H25, in line with last year.
Valuation and Investment Case: Attractive Upside Potential
– Target price: HK\$42.60, based on a DCF model with a WACC of 10.6%. – Current valuation: 12.1x 2025F PE; target price implies 13.7x 2025F PE. – Investment catalysts:
- Accelerated business expansion.
- Government policies supporting the upgrading of old residential communities.
Conclusion: Poly Property Services Remains a Defensive Growth Play
Poly Property Services continues to outperform its peers by delivering stable growth, expanding third-party contracts, and maintaining operational discipline. The company’s solid cash position and absence of debt provide a buffer against sector volatility, while its focus on top-tier cities and public property management offer a pathway for future growth. With a BUY rating and an attractive upside to the target price, Poly PS stands out as a resilient and efficient operator in China’s property management landscape.
