Industry Flash Note. China Property Sector. China / Hong Kong. Less risk averse stand poses a hidden danger. DBS Group Research.

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1 Industry Refer to important disclosures at the end of this report DBS Group Research. Equity 3 Apr 217 China Property Sector ANALYST Danielle WANG CFA, danielle_wang@dbs.com Trista QIN trista_qin@dbs.com Carol WU carol_wu@dbs.com Ken HE CFA, ken_he@dbs.com Andy YEE CFA, andyyee@dbs.com Less risk averse stand poses a hidden danger Differentiated tightening policy may become unitized as more cities follow suit Strong presales ytd may have misled developers into setting aggressive sales target Developers inventory level can be worse than end-14 if missing sales target by 1 Sector valuation ecessive at 7.3 FY17 PE; stay with defensive plays - CR Land and Longfor What s New Increasing tightening in more cities to curb investment/speculation demand. Y-o-y growth of GFA sales in 19 cities which issued tighening policies in September/October 216 have kept trending down and recorded a 38.7 decline in 2M17. We believe further tightening in cities seeing high price increase, especially those near tier 1 cities, will be inevitable. Increasing portion of investment demand will require further tighening. We believe Beijing has set an eample to other cities that tightening policies can be stricter than ever. Along with potential changes in monetory policy, we are concerned about sales slowdown in the coming quarters. However, the stock market and developers seem still in a riskon mode. Strong presales ytd may have misled developers into setting aggressive presales targets; a reverse of two years destocking trend. Developers we tracked are aiming for growth of -39 and averaging 21. Planned saleable resources are 29 higher than actual saleable in 216. In our view, such a plan is highly risky if presales slow down. Inventory level will build up at a fast pace by end-217. Our analysis shows that key developers saleable inventory level will increase from seven months at end-216 to 11 months by end-217 if they miss their targets by 1. (see senario analysis on p.2) Sector valuation ecessive. The sector is trading at a 7.3 FY17 PE, higher than the peak level of 214 (6.8 forward PE) when the sector was in a down cycle. We suggest that investors stay with defensive plays - CR Land and Longfor. ed-th / sa- AH

2 GFA sold of 19 cities that are subject to home purchase restriction and higher down payment ratio since Sep/Oct 216 k sm 3, 25, 2, 15, 1, 5, /1/216 2/1/216 3/1/216 4/1/216 5/1/216 6/1/216 7/1/216 8/1/216 9/1/216 1/1/216 11/1/216 12/1/216 1/1/217 2/1/ cities GFA sold y-o-y growth Source: CREIS; DBS Vickers Developers target to achieve 21 growth in sales on average Rmb m FY17 sales target FY16 sales growth COLI 19,99 175,539 9 R&F 73, 6,844 2 Country Garden 4, 38,84 3 Sino-Ocean 6, 5,38 19 Beijing Capital Land 5, 45,51 1 CR Land 12, 18,4 11 Shimao 8, 68, Powerlong 2, 17,64 13 Agile 6, 52,81 14 Central China 26,8 2, KWG 28, 22, Yueiu Property 33, 3,253 9 Evergrande 45, 373,36 21 Longfor 11, 88,14 25 China J inmao 58, 48,516 2 Yanlord 32, 33,635-5 Sunac 21, 15,63 39 Yuzhou 28, 23,26 21 CIFI 65, 53, 23 Total 2,148,39 1,778, Source: Companies; DBS Vickers Page 2

3 Saleable resources would grow by 29 and implied sell-through rate would come down to 6 Rmb m resources in 217 Implied sellthrough rate resources in 216 Actual sellthrough rate saleable resources COLI 318, , R&F 14, 52 11, Country Garden 616, , 7 4 Sino-Ocean 14, 58 8, 63 3 Beijing Capital Land 72, , CR Land 243, , Shimao 133, , 55 7 Powerlong 4, 5 31, Agile 97, , Central China 39, , KWG 46, 61 37, 6 24 Yueiu Property 68, 49 6, 5 13 Evergrande 669, , Longfor 17, , China J inmao 85, , Yanlord 5, 64 43, Sunac 418,5 5 22, 68 9 Yuzhou 5, 56 35, CIFI 11, 59 65, ,571,39 6 2,77, Source: Companies; DBS Vickers Page 3

4 Developers' inventory is epected to increase to 11 months if they miss 1 of their sales target Rmb m End-216 If meeting target If missing target by 1 If missing target by 1 COLI R&F Country Garden Sino-Ocean Beijing Capital Land CR Land Shimao Powerlong Agile Central China KWG Yueiu Property Ev ergrande Longfor China J inmao Yanlord Sunac Yuzhou CIF I (1) Senario 1: developers miss 1 of their sales target in 217 (2) Senario 2: developers miss 2 of their sales target in 217 Source: Companies; DBS Vickers No. of month inventory Page 4

5 Developers historical inventory level No. of months 213 inventory 214 inventory 215 inventory 216 inventory 217 inventory^ COLI R&F Country Garden Sino-Ocean CR Land Shimao Agile Central China KWG Yueiu Property Evergrande Longfor China Jinmao Yanlord Sunac Yuzhou ^ Assuming dev elopers miss 1 of their sales target in 217 Source: Companies; DBS Vickers Developers historical inventory level E No. of months ^ assuming developers miss 1 of their sales target in 217 Source: Companies; DBS Vickers Page 5

6 Valuation comparison 3-mth daily Net Disc/ 31-Mar Mkt trading 12-m EPS gth PE PE Yield Yield ROE ROE Gearing P/Bk NAV (Prem) Price Cap value Recom target 17F 18F 17F 18F 17F 18F 17F 18F 1H16 1H16 to NAV Company Name Code HK$ US$bn US$m HK$ HK$ Large cap China Overseas* 688 HK BUY (17) (4.2) Country Garden* 27 HK HOLD CR Land* 119 HK BUY (2) China Vanke 'H'* 222 HK HOLD Evergrande* 3333 HK HOLD Longfor* 96 HK BUY (1) Shimao Property* 813 HK HOLD 11.2 (11) Average Mid cap Agile Property* 3383 HK FV China South City*^^ 1668 HK FV n.a n.a COGO* 81 HK BUY China Jinmao Hldgs* 817 HK HOLD Greentown 39 HK NR n.a Guangzhou R&F 2777 HK NR n.a Hopson Dev 754 HK NR n.a n.a. n.a n.a. n.a. KWG Property 1813 HK NR n.a Logan Property 338 HK NR n.a n.a. n.a. Poly (Hong Kong) 119 HK NR n.a Shui On Land* 272 HK HOLD 1.98 (53) Sino-Ocean Land* 3377 HK BUY Soho China* 41 HK HOLD 4.16 (67) Sunac China 1918 HK NR n.a. (6) n.a. n.a. Yanlord Land*^ YLLG SP BUY 2.21 (12) Yueiu Property* 123 HK HOLD 1.23 (14) Average# Small cap BJ Cap Land 'H' 2868 HK NR n.a. (2) n.a. n.a. BJ North Star 'H' 588 HK NR n.a. 5 n.a. 7.1 n.a. 2.3 n.a. 6.6 n.a n.a. n.a. C C Land* 1224 HK Hold (79) (23.2) Central China* 832 HK HOLD China SCE 1966 HK NR n.a. (22) n.a. n.a. CIFI Holdings 884 HK NR n.a n.a. n.a. First Sponsor*^ FSG SP NR 7 13 n.a n.a Glorious Property 845 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a Hydoo Int'l 1396 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a n.a. n.a. Kaisa Group 1638 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Lai Fung* 1125 HK NR n.a. (73) n.a. 1 n.a Minmetals Land 23 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. (14.9).5 n.a. n.a. Modern Land (China) 117 HK NR n.a n.a. n.a. Powerlong 1238 HK NR n.a. (21) n.a. n.a. Renhe Commercial 1387 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a Greenland* 337 HK BUY n.a. 1.8 n.a SRE Group 127 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a n.a. n.a. Sunshine 1 China 268 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a n.a. n.a. Times Property 1233 HK NR n.a n.a. n.a. Wuzhou Int'l 1369 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a n.a. n.a. Ying Li^ YINGLI SP NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a Yuzhou Properties 1628 HK NR n.a Zhong An 672 HK NR n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a n.a. n.a. Average** Average (Overall)@ ~ ^ Denominated in SGD for price ~ Simple average discount to NAV; Market cap weighted average NAV = 29 # Eclude Soho China & Shui On Land ** Eclude Greenland, First Sponsor & Lai Eclude Soho China, Shui On Land, Greenland, First Sponsor & Lai Fung ^^ FY15: 16F; FY16: FY17F; FY17: FY18F Source: Thomson Reuters, *DBS Vickers Page 6

7 PE valuations, 28 to 216 trough (based on earnings forecasts) 31-Mar Mkt 17F 18F PE () Company Name Code Price HK$ Cap US$bn PE PE Trough 28 Trough 29 Trough 21 Trough 211 Trough 212 Trough 213 Trough 214 Trough 215 Trough 216 China Overseas* 688 HK Country Garden* 27 HK CR Land* 119 HK China Vanke 'H'* 222 HK n.a. n.a. n.a. n.a. n.a. n.a Evergrande* 3333 HK n.a. n.a Longfor* 96 HK n.a Shimao Property* 813 HK Average Agile Property* 3383 HK China South City*^^ 1668 HK n.a. n.a COGO* 81 HK n.a. n.a. n.a China Jinmao Hldgs* 817 HK Greentown 39 HK Guangzhou R&F 2777 HK Hopson Dev 754 HK KWG Property 1813 HK Logan Property 338 HK n.a. n.a. n.a. n.a. n.a. n.a Poly (Hong Kong) 119 HK Shui On Land* 272 HK Sino-Ocean Land* 3377 HK Soho China* 41 HK Sunac China 1918 HK n.a. n.a Yanlord Land*^ YLLG SP Yueiu Property* 123 HK Average# BJ Cap Land 'H' 2868 HK BJ North Star 'H' 588 HK n.a C C Land* 1224 HK n.a. n.a Central China* 832 HK China SCE 1966 HK n.a. n.a CIFI Holdings 884 HK n.a. n.a. n.a. n.a. n.a First Sponsor*^ FSG SP n.a. n.a. n.a. n.a. n.a. n.a. n.a Glorious Property 845 HK.87.9 n.a. n.a. n.a Hydoo Int'l 1396 HK.67.3 n.a. n.a. n.a. n.a. n.a. n.a. n.a Kaisa Group 1638 HK n.a. n.a. n.a. n.a Lai Fung* 1125 HK n.a Minmetals Land 23 HK 1..4 n.a. n.a Modern Land (China) 117 HK n.a. n.a. n.a. n.a. n.a. n.a Powerlong 1238 HK n.a Renhe Commercial 1387 HK n.a. n.a Greenland* 337 HK n.a SRE Group 127 HK.2.5 n.a. n.a Sunshine 1 China 268 HK n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a Times Property 1233 HK n.a. n.a. n.a. n.a. n.a. n.a Wuzhou Int'l 1369 HK.78.2 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a Ying Li^ YINGLI SP.16.3 n.a. n.a. n.a Yuzhou Properties 1628 HK n.a Zhong An 672 HK.65.2 n.a. n.a Average** Average (Overall)@ ^ Denominated in SGD for price # Eclude Soho China & Shui On Land for 16F & 17F PE ** Eclude Greenland, First Sponsor & Lai Fung for 16F & 17F Eclude Soho China, Shui On Land, Greenland, First Sponsor & Lai Fung for 16F & 17F PE ^^ FY15: 16F; FY16: FY17F; FY17: FY18F Source: Thomson Reuters, *DBS Vickers Page 7

8 PE valuations, 28 to 216 peak (based on earnings forecasts) 31-Mar Mkt 17F 18F PE () Company Name Code Price HK$ Cap US$bn PE PE Peak 28 Peak 29 Peak 21 Peak 211 Peak 212 Peak 213 Peak 214 Peak 215 Peak 216 China Overseas* 688 HK Country Garden* 27 HK CR Land* 119 HK China Vanke 'H'* 222 HK n.a. n.a. n.a. n.a. n.a. n.a Evergrande* 3333 HK n.a. n.a Longfor* 96 HK n.a Shimao Property* 813 HK Average Agile Property* 3383 HK China South City*^^ 1668 HK n.a. n.a COGO* 81 HK n.a. n.a. n.a China J inmao Hldgs* 817 HK Greentown 39 HK Guangzhou R&F 2777 HK Hopson Dev 754 HK KWG Property 1813 HK Logan Property 338 HK n.a. n.a. n.a. n.a. n.a. n.a Poly (Hong Kong) 119 HK Shui On Land* 272 HK Sino-Ocean Land* 3377 HK Soho China* 41 HK Sunac China 1918 HK n.a. n.a Yanlord Land*^ YLLG SP Yueiu Property* 123 HK Average# BJ Cap Land 'H' 2868 HK BJ North Star 'H' 588 HK n.a C C Land* 1224 HK n.a. n.a. n.a Central China* 832 HK China SCE 1966 HK n.a. n.a CIFI Holdings 884 HK n.a. n.a. n.a. n.a. n.a First Sponsor*^ FSG SP n.a. n.a. n.a. n.a. n.a. n.a. n.a Glorious Property 845 HK.87.9 n.a. n.a. n.a Hydoo Int'l 1396 HK.67.3 n.a. n.a. n.a. n.a. n.a. n.a. n.a Kaisa Group 1638 HK n.a. n.a. n.a. n.a Lai Fung* 1125 HK n.a Minmetals Land 23 HK 1..4 n.a. n.a n.a Modern Land (China) 117 HK n.a. n.a. n.a. n.a. n.a. n.a Powerlong 1238 HK n.a Renhe Commercial 1387 HK n.a. n.a Greenland* 337 HK n.a SRE Group 127 HK.2.5 n.a. n.a Sunshine 1 China 268 HK n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a Times Property 1233 HK n.a. n.a. n.a. n.a. n.a. n.a Wuzhou Int'l 1369 HK.78.2 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a Ying Li^ YINGLI SP.16.3 n.a. n.a. n.a Yuzhou Properties 1628 HK n.a Zhong An 672 HK.65.2 n.a. n.a Average** Average (Overall)@ ^ Denominated in SGD for price # Eclude Soho China & Shui On Land for 16F & 17F PE ** Eclude Greenland, First Sponsor & Lai Fung for 16F & 17F Eclude Soho China, Shui On Land, Greenland, First Sponsor & Lai Fung for 16F & 17F PE ^^ FY15: 16F; FY16: FY17F; FY17: FY18F Source: Thomson Reuters, *DBS Vickers Page 8

9 PE valuations, 28 to 216 trough (based on reported earnings) 3-mth daily 31-Mar Mkt trading F Y17F F Y18F Price Cap value PE PE Avg Trough Trough Trough Trough Trough Trough Trough Trough Trough Company Name Code HK$ US$bn US$m PE () China Overseas* 688 HK Country Garden* 27 HK CR Land* 119 HK China Vanke 'H'* 222 HK n.a. n.a. n.a. n.a. n.a Evergrande* 3333 HK n.a Longfor* 96 HK n.a Shimao Property* 813 HK Average Agile Property* 3383 HK China South City*^^ 1668 HK n.a. 6. n.a. n.a. n.a COGO* 81 HK (3.5) China Jinmao Hldgs* 817 HK Greentown 39 HK Guangzhou R&F 2777 HK Hopson Dev 754 HK KWG Property 1813 HK Logan Property 338 HK n.a. n.a. n.a. n.a. n.a Poly (Hong Kong) 119 HK () 85.5 Shui On Land* 272 HK Sino-Ocean Land* 3377 HK Soho China* 41 HK n.a. n.a. n.a. n.a. n.a. n.a. n.a Sunac China 1918 HK n.a. n.a. n.a Yanlord Land*^ YLLG SP Yueiu Property* 123 HK (4.6) Average# BJ Cap Land 'H' 2868 HK BJ North Star 'H' 588 HK n.a C C Land* 1224 HK n.a. n.a. n.a. n.a. n.a. n.a. n.a Central China* 832 HK China SCE 1966 HK n.a. n.a CIFI Holdings 884 HK n.a. n.a. n.a. n.a First Sponsor*^ FSG SP n.a. 2.4 n.a. n.a. n.a. n.a. n.a. n.a Glorious Property 845 HK n.a. n.a. 1.6 n.a (2.2) (1.4) n.a. Hydoo Int'l 1396 HK n.a. n.a n.a. n.a. n.a. n.a. n.a. n.a n.a. Kaisa Group 1638 HK n.a. n.a. 4.5 n.a n.a. n.a. (11.6) Lai Fung* 1125 HK n.a Minmetals Land 23 HK n.a. n.a Modern Land (China) 117 HK n.a. n.a. n.a. n.a. n.a Powerlong 1238 HK n.a Renhe Commercial 1387 HK n.a. n.a. n.a (3.6) (3.2) (2.3) (.5) Greenland* 337 HK n.a (1.1) SRE Group 127 HK n.a. n.a (1.6) (.6) (12.9) Sunshine 1 China 268 HK n.a. n.a. 8.7 n.a. n.a. n.a. n.a. n.a. n.a n.a. Times Property 1233 HK n.a. n.a. n.a. n.a. n.a Wuzhou Int'l 1369 HK n.a. n.a. 1.2 n.a. n.a. n.a. n.a. n.a (5.7) n.a. Ying Li^ YINGLI SP n.a. n.a Yuzhou Properties 1628 HK n.a Zhong An 672 HK n.a. n.a n.a. Average** Average (Overall)@ HSI Inde HSI ^ Denominated in SGD for price # Eclude Soho China & Shui On Land for 16F & 17F PE ** Eclude Greenland, First Sponsor & Lai Fung for 16F & 17F Eclude Soho China, Shui On Land, Greenland, First Sponsor & Lai Fung for 16F & 17F PE ^^ FY15: 16F; FY16: FY17F; FY17: FY18F Source: Thomson Reuters, *DBS Vickers Page 9

10 PE valuations, 28 to 216 peak (based on reported earnings) 3-mth daily 31-Mar Mkt trading F Y17F F Y18F Price Cap v alue PE PE Av g Peak Peak Peak Peak Peak Peak Peak Peak Peak Company Name Code HK$ US$bn US$m PE () China Overseas* 688 HK Country Garden* 27 HK CR Land* 119 HK China Vanke 'H'* 222 HK n.a. n.a. n.a. n.a. n.a Evergrande* 3333 HK n.a Longfor* 96 HK n.a Shimao Property* 813 HK Average Agile Property* 3383 HK China South City*^^ 1668 HK n.a. 6. n.a. n.a. n.a COGO* 81 HK n.a China Jinmao Hldgs* 817 HK Greentown 39 HK Guangzhou R&F 2777 HK Hopson Dev 754 HK KWG Property 1813 HK n.a Logan Property 338 HK n.a. n.a. n.a. n.a. n.a Poly (Hong Kong) 119 HK (6.8) Shui On Land* 272 HK Sino-Ocean Land* 3377 HK Soho China* 41 HK n.a Sunac China 1918 HK n.a. n.a. n.a Yanlord Land*^ YLLG SP Yueiu Property* 123 HK n.a Average# BJ Cap Land 'H' 2868 HK BJ North Star 'H' 588 HK n.a C C Land* 1224 HK n.a. n.a Central China* 832 HK China SCE 1966 HK n.a. n.a CIFI Holdings 884 HK n.a. n.a. n.a. n.a First Sponsor*^ FSG SP n.a. 2.4 n.a. n.a. n.a. n.a. n.a. n.a Glorious Property 845 HK n.a. n.a. 1.6 n.a (3.8) (2.3) n.a. Hydoo Int'l 1396 HK n.a. n.a n.a. n.a. n.a. n.a. n.a. n.a n.a. Kaisa Group 1638 HK n.a. n.a. 4.5 n.a n.a. n.a. (11.6) Lai Fung* 1125 HK n.a Minmetals Land 23 HK n.a. n.a Modern Land (China) 117 HK n.a. n.a. n.a. n.a. n.a Powerlong 1238 HK n.a Renhe Commercial 1387 HK n.a. n.a. n.a (8.4) (5.5) (7.3) (1.) Greenland* 337 HK n.a (1.8) SRE Group 127 HK n.a. n.a (13.9) (2.7) (24.3) Sunshine 1 China 268 HK n.a. n.a. 8.7 n.a. n.a. n.a. n.a. n.a. n.a n.a. Times Property 1233 HK n.a. n.a. n.a. n.a. n.a Wuzhou Int'l 1369 HK n.a. n.a. 1.2 n.a. n.a. n.a. n.a. n.a (15.) n.a. Ying Li^ YINGLI SP n.a. n.a Yuzhou Properties 1628 HK n.a Zhong An 672 HK n.a. n.a n.a. Average** Average (Overall)@ HSI Inde HSI ^ Denominated in SGD for price # Eclude Soho China & Shui On Land for 16F & 17F PE ** Eclude Greenland, First Sponsor & Lai Fung for 16F & 17F Eclude Soho China, Shui On Land, Greenland, First Sponsor & Lai Fung for 16F & 17F PE ^^ FY15: 16F; FY16: FY17F; FY17: FY18F Source: Thomson Reuters, *DBS Vickers Page 1

11 Share price performance Price Performance 27 1-wk 2-wk 1-mth 2-mth 3-mth 4-mth 5-mth 6-mth YTD 1-yr high Tier 1 play ers China Overseas 688 HK (6.5) (1.8) (7.1) (3.3) 8. (.9) (7.3) (15.6) 8. (9.6) 78. (5.6) (24.4) 18.3 Country Garden 27 HK (2.) (32.8) (45.9) CR Land 119 HK (6.5) (6.9) (.9) (2.8) (8.9) (22.8) 1.4 China Vanke 'H' 222 HK (7.5) (9.7) (11.8) n.a. n.a. n.a (22.7) n.a. Evergrande 3333 HK (3.4) (29.2) n.a. Longfor Properties 96 HK (7.3) (3.6) (28.6) (7.8) 15.7 (14.9) n.a. Shimao Property 813 HK (7.6) (4.2) (2.7) () (26.4) (57.5) Average (4.1) () (6.1) (4.2) 26.2 (14.9) (2.9) Tier 2 play ers Agile Property 3383 HK (7.2) (23.8) (46.9) (2.) (8.6) (65.8) China South City 1668 HK (4.2) (4.2) (1.2) (4.2) (1.2) (11.1) (7.) (7.) (1.2) (5.6) (7.4) n.a. COGO 81 HK (4.4) (1.2) (2.7) (46.7) (16.8) (22.9) (9.7) China Jinmao Hldgs 817 HK (5.7) (4.6) (3.2) (17.4) 19.4 (21.1) (6.1) Greentown 39 HK (16.7) (6.7) (16.6) (35.). (18.4) (62.2) GZ R&F 2777 HK (6.8) (6.5) (.5) (12.1) (16.3).6 (1.8) (72.) Hopson Dev 754 HK (2.3) (4.2) (6.5) 3.5 (6.8) 27.2 (24.6) (24.) 8.7 () (77.1) KWG 1813 HK (8.2) (26.1) (17.8) (55.6) Logan Property 338 HK n.a. n.a n.a. Poly HK 119 HK (6.6) (5.8) (.6) (31.7) (22.9) (2.7) 1.6 (71.7) Shui On Land 272 HK (3.8) (6.4) (4.9) (8.9) (17.1) 4.8 (16.3) 58.9 (31.1) (23.1) 16.4 (21.6) (82.3) Sino-Ocean 3377 HK (12.) () (5.4) (.5) 6.8 (12.1) (13.4) 12.7 (3.2) (75.7) SOHO China 41 HK (5.9) (.7) (18.) (31.4) 1.6 (65.1) Sunac China 1918 HK (2) 69.7 (24.) 7.5 n.a. Yanlord Land YLLG SP (.8) (19.4) (15.1) (3.4) 31.3 (57.) Yueiu Property 123 HK (2.2) () (22.) (16.8) (1.1) (2.9) (54.2) Average (4.8) (1.1) (11.1) (8.5) (.9) (8.4) (61.7) Tier 3 play ers BJ Cap. Land 2868 HK (7.1) (6.9) (18.) (18.) (52.9) BJ North Star 588 HK (3.7) (4.3) (16.7) (7.) (63.5) C C Land 1224 HK (.5). (11.8) (11.4) (7.5) (3.7) (7.5) (9.5) 88.9 (28.3) (3.7) 79.2 (6.6) (87.5) Central China 832 HK (12.8) (26.8) (7.4) 4.3 n.a. China SCE Property 1966 HK (5.5) (1.3) (12.4) n.a. CIFI Holdings 884 HK (5.) (1.9) n.a (6.1) n.a. First Sponsor FSG SP n.a. n.a. n.a n.a. Glorious Property 845 HK (4.4) (7.4) (2.2) (25.6) (6.5) (15.5) 14.5 (4.4) (28.1) (25.) (15.6) n.a. Hydoo Int'l 1396 HK (9.5) 15.5 (8.2) (14.1) (15.2) 15.5 (36.8) n.a. n.a. (13.5) (44.) (46.3) n.a. Kaisa Group 1638 HK (36.4) (1.9). n.a. Lai Fung 1125 HK (.5) (4.5) (5.3) (19.9) (17.2) 23.8 (54.4) Minmetals Land 23 HK (2.) (4.8) (19.5) (13.6) (73.) Modern Land (China) 117 HK (3.6) (5.7) (13.2) n.a. n.a (53.2) n.a. Powerlong 1238 HK (9.8) (5.8) (34.3) n.a. Renhe Commercial 1387 HK (3.5) (7.1) (11.4) () (2.) () (3.) 1. (2.) (37.1) (8.9) (38.9) (28.1) 5.9 (44.7) n.a. Greenland 337 HK (4.6) (5.) (5.9) (7.1) 8.3 (13.6) (18.3) (1.9) (36.1) (72.) SRE Group 127 HK (5.3) (4.9) () (.5) (2.) (11.4) (14.5) (22.) (2.) (17.) 24.2 (32.9) (2.8) 73.8 (45.5) (94.3) Sunshine 1 China 268 HK 2.2 () (5.2) 12. (11.6) 4.1 (.6) 3.8 (11.6) (4.9) n.a. n.a. n.a n.a. Times Property 1233 HK (4.8) n.a. n.a. (5.7) (18.2) 4.4 n.a. Wuzhou Int'l 1369 HK..... (1.3) ().. (1.3) n.a. n.a. 14. (44.9) (3.7) n.a. Ying Li YINGLI SP (1.3) (4.3) (3.1) (3.1) (4.3) (38.) (32.2) (1.2) (87.1) Yuzhou Properties 1628 HK (6.6) n.a. Zhong An 672 HK. (3.) (4.4) (11.) (15.6) 1.6 (11.) (2.8) (28.9) (21.) (88.7) Average (13.5) 6.9 (4.5) (72.1) Average (Overall) (2.) (.4) (4.9) (1.4) 6.9 (7.4) (59.6) Hang Seng Inde (1.) (.8) (7.2).4 (23.8) MSCI China (.6) (.4) (1.1) (1.4) (35.9) Source: Thomson Reuters Page 11

12 Discount to NAV Sector average (DBSV coverage only) Agile Property (3383 HK) SD: -1.7 (2) +1SD (2) (4) (6) (8) Oct-6 Dec-7 Jan-9 Mar-1 +1SD: Mean: SD: May-11 Jul-12-2SD: -7.7 Sep-13 Nov-14 Jan-16 (4) (6) (8) (1) Jul-8-1SD Sep-9 Dec-1 Mar-12 Avg: Jun-13 Sep-14 Dec-15 Central China (832 HK) China Jinmao Holdings (817 HK) (3) (4) (5) (6) (7) (8) (9) (1) Jan-9 +1SD -6.6 Avg: SD Aug-1 Apr-12 Nov-13 Jul-15 (3) (35) (4) (45) (5) (55) (6) (65) (7) (75) (8) Nov-9 Feb-11 +1SD Avg: -5-1SD -6.5 May-12 Jul-13 Oct-14 Dec-15 China Overseas (688 HK) COGO (81 HK) (2) (4) (6) (8) Jan-5 Jan-7 +1SD 2.6 Avg: SD -3.3 Jan-9 Feb-11 Feb-13 Feb-15 (1) (2) (3) (4) (5) (6) (7) (8) (9) Jan-1 Jun-11-1SD Nov-12 Apr-14 +1SD Avg: Oct-15 Source: Thomson Reuters, DBS Vickers Page 12

13 Discount to NAV (continued) CR Land (119 HK) China Vanke (222 HK) (1) (2) (3) (4) (5) (6) (7) (8) Jan-5 Jan-7 +1SD Avg: SD Jan-9 Feb-11 Feb-13 Feb (5) (1) (15) (2) (25) (3) (35) (4) Jun-15 +1SD -6.7 Avg: SD Oct-15 Jan-16 Apr-16 Aug-16 Nov-16 Country Garden (27 HK) Evergrande (3333 HK) (2) (4) (6) (8) Jan-9 +1SD -8.3 Avg: Aug-1 Apr-12-1SD Nov-13 Jul-15 (1) (2) (3) (4) +1SD -42 (5) Avg: (6) (7) (8) -1SD (9) Nov-9 May-1 Dec-1 Jul-11 Feb-12 Sep-12 Mar-13 Oct-13 May-14 Dec-14 Jun-15 Jan-16 Aug-16 Greenland (337 HK) Longfor (96 HK) (2) (4) (6) (8) (1) Nov-8 +1SD Avg: -44 Jul-1 Mar-12-1SD Nov-13 Jul-15 (1) (2) (3) (4) (5) (6) Jan-17 +1SD 35.8 Avg: 1-1SD Jan-17 Feb-17 Feb-17 Feb-17 Feb-17 Source: Thomson Reuters, DBS Vickers Page 13

14 Discount to NAV (continued) Shimao Property (813 HK) Shui On Land (272 HK) (2) (4) (6) (8) (1) Mar-7 Jun-8 +1SD SD Sep-9 Dec-1 Mar-12 Jun-13 Avg: Sep-14 Dec-15 (1) (2) (3) (4) (5) (6) (7) (8) (9) (1) Oct-6 Mar-8 +1SD Avg: SD Sep-9 Mar-11 Sep-12 Mar-14 Sep-15 Sino-Ocean Land (3377 HK) SOHO China (41 HK) (2) (4) (6) (8) (1) Oct-7-1SD Aug-9 Jul-11 +1SD -2.8 Avg: -41 May-13 Apr (2) (4) (6) (8) Oct-7 May-9-1SD Nov-1 Jun-12 +1SD Avg: Jan-14 Aug-15 Yueiu Property (123 HK) Yanlord Land (YLLG SP) (35) 6 (4) 4 (45) 2 (5) (55) (6) +1SD Avg: (2) (4) +1SD Avg: (65) (7) -1SD (6) (8) -1SD (75) (1) Feb-13 Jun-13 Oct-13 Feb-14 May-14 Sep-14 Jan-15 Apr-15 Aug-15 Dec-15 Apr-16 Jul-16 Nov-16 Oct-7 Aug-9 Jul-11 May-13 Apr-15 Source: Thomson Reuters, DBS Vickers Page 14

15 PE charts Sector average Agile Property (3383 HK) (5) Jan-5-1SD: 3.8 Jan-7 Jan-9 +2SD: SD: 14 Mean: 8.9-2SD: -1.3 Feb-11 Feb-13 Feb Dec-5-1SD: 4.7 Sep-7 May-9 +1SD: 8.9 Avg: 6.8 Feb-11 Oct-12 Jul-14 Apr-16 Central China (832 HK) China Jinmao Holdings (817 HK) Jun-8 +1SD: 6.5 Avg: 5.2-1SD: 3.9 Jan-1 Aug-11 Mar-13 Oct-14 May Aug-7-1SD: 4.2 May-9 Jan-11 +1SD: 13.3 Avg: 8.8 Oct-12 Jul-14 Apr-16 China Overseas (688 HK) COGO (81 HK) Jan-5 Mar-6-1SD: 5 May-7 Jul-8 Sep-9 Nov-1 +1SD: 14.5 Avg: 9.8 Feb-12 Apr-13 Jun-14 Aug-15 Oct-16 J Jan (Dec-7) +1SD: 18.6 Avg: 7.8-1SD: -2.9 Mar-2 May-5 Jun-8 Aug-11 Oct-14 Source: Thomson Reuters, DBS Vickers Page 15

16 PE charts (continued) CR Land (119 HK) China Vanke (222 HK) Jan-5-1SD: 4.8 Mar-6 May-7 Jul-8 Sep-9 Nov-1 Feb-12 +1SD: 18 Avg: 11.4 Apr-13 Jun-14 Aug-15 Oct Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 +1SD: 9.7 Avg: 8.8-1SD: 7.9 Dec-16 Jun-17 Country Garden (27 HK) Evergrande (3333 HK) SD: 31.7 Avg: SD: SD: 8.3 Avg: 5.6-1SD: 2.9 Apr-7 Jun-9 Jul-11 Sep-13 Nov-15 Nov-9 Jun-11 Feb-13 Sep-14 May-16 Greenland (337 HK) Longfor (96 HK) Oct-6 Mar-8 Jul-9 +1SD: 18.7 Avg: 9.7-1SD:.7 Dec-1 May-12 Oct-13 Mar-15 Aug Nov-9 Nov-1 Nov-11 +1SD: 7.7 Avg: 6.7-1SD: 5.8 Nov-12 Nov-13 Nov-14 Nov-15 Nov-16 Source: Thomson Reuters, DBS Vickers Page 16

17 PE charts (continued) Shimao Property (813 HK) Shui On Land (272 HK) SD: SD:.4 Jul-6 Jun-8 May-1 +1SD: 18.2 Avg: 9.3 Apr-12 Mar-14 Jan Oct-6 Oct-7 Oct-8 Oct-9 Avg: 9.9 Nov-1 Nov-11 Nov-12 Nov-13-1SD: 4.9 Dec-14 Dec-15 Dec-16 Sino-Ocean Land (3377 HK) SOHO China (41 HK) Sep-7 Jun-9-1SD: 5.1 Feb-11 +1SD: 15.1 Avg: 1.1 Nov-12 Jul-14 Apr Oct-7 Jun-9 Mar-11 +1SD: 32.6 Avg: 15.4 Nov-12 Jul-14-1SD: -1.8 Apr-16 Yueiu Property (123 HK) Yanlord (YLLG SP) Jan-3 Dec-5-1SD: 3.1 Dec-8 +1SD: 12.9 Avg: 8 Dec-11 Dec Jun-6-1SD: 4 Feb-8 +1SD: 14.6 Oct-9 May-11 Jan-13 Avg: 9.3 Sep-14 May-16 Source: Thomson Reuters, DBS Vickers Page 17

18 PB charts Sector average Agile Property (3383 HK) SD SD Mean SD: 2.1 Avg: (.5) Jan-5 Jan-7 Jan-9-1SD.5-2SD -.7 Feb-11 Feb-13 Feb Dec-5-1SD:.4 Sep-7 May-9 Feb-11 Oct-12 Jul-14 Apr-16 Central China (832 HK) China Jinmao Holdings (817 HK) SD:.5 +1SD:.9 Avg: SD: 1.3 Avg:.9.2. Jun-8 Jan-1 Aug-11 Mar-13 Oct-14 May Aug-7-1SD:.5 May-9 Jan-11 Oct-12 Jul-14 Apr-16 China Overseas (688 HK) COGO (81 HK) Jan-5-1SD: 1 Mar-6 May-7 Jul-8 Sep-9 Nov-1 Feb-12 +1SD: Avg: 1.7 Apr-13 Jun-14 Aug-15 Oct Jan-99 +1SD: 1.3 Avg:.8 Mar-2 May-5 Jun-8 Aug-11-1SD:.2 Oct-14 Source: Thomson Reuters, DBS Vickers Page 18

19 PB charts (continued) CR Land (119 HK) China Vanke (222 HK) Jan-5 Mar-6 May-7 Avg: 1.3-1SD:.8 Jul-8 Sep-9 Nov-1 Feb-12 +1SD: 1.7 Apr-13 Jun-14 Aug-15 Oct Jun-14 Dec-14 Jun-15-1SD: 1.4 Dec-15 Jun-16 +1SD: 1.7 Avg: 1.6 Dec-16 Jun-17 Country Garden (27 HK) Evergrande (3333 HK) SD: Avg: SD:.3. Apr-7 Jun-9 Jul-11 Sep-13 Nov-15 Nov-9-1SD:.8 Jun-11 +1SD: 1.6 Avg: 1.2 Feb-13 Sep-14 May-16 Greenland (337 HK) Longfor (96 HK) Oct-6 Mar-8 Jul-9 +1SD: Avg:.9 Dec-1 May-12 Oct-13-1SD:.4 Mar-15 Aug Nov-9 Nov-1-1SD:.9 Nov-11 Nov-12 Nov-13 +1SD: 1.8 Avg: 1.3 Nov-14 Nov-15 Nov-16 Source: Thomson Reuters, DBS Vickers Page 19

20 PB charts (continued) Shimao Property (813 HK) Shui On Land (272 HK) Jul-6 Jun-8 May-1 +1SD: 1.8 Avg: 1.2-1SD:.6 Apr-12 Mar-14 Jan SD:.3. Oct-6 Oct-7 Oct-8 Oct-9 Nov-1 +1SD: 1.1 Avg:.7 Nov-11 Nov-12 Nov-13 Dec-14 Dec-15 Dec-16 Sino-Ocean Land (3377 HK) SOHO China (41 HK) Sep-7 Jun-9-1SD:.4 Feb-11 +1SD: 1.2 Avg:.8 Nov-12 Jul-14 Apr Oct-7 Jun-9 +1SD: 1.2-1SD:.5 Mar-11 Nov-12 Jul-14 Avg:.9 Apr-16 Yueiu Property (123 HK) Yanlord (YLLG SP) Jan-3 Avg:.6-1SD:.4 Dec-5 Dec-8 Dec-11 +1SD:.8 Dec SD:.3.5. Jun-6 Feb-8 Oct-9 +1SD: 1.9 May-11 Jan-13 Avg: 1.1 Sep-14 May-16 Source: Thomson Reuters, DBS Vickers Page 2

21 DBSVHK recommendations are based an Absolute Total Return* Rating system, defined as follows: STRONG BUY (>2 total return over the net 3 months, with identifiable share price catalysts within this time frame) BUY (>15 total return over the net 12 months for small caps, >1 for large caps) HOLD (-1 to +15 total return over the net 12 months for small caps, -1 to +1 for large caps) FULLY VALUED (negative total return i.e. > -1 over the net 12 months) SELL (negative total return of > -2 over the net 3 months, with identifiable catalysts within this time frame) Share price appreciation + dividends Completed Date: 3 Apr :3:5 (HKT) Dissemination Date: 3 Apr :53:59 (HKT) GENERAL DISCLOSURE/DISCLAIMER This report is prepared by DBS Vickers (Hong Kong) Limited ( DBSVHK ). This report is solely intended for the clients of DBS Bank Ltd., DBS Vickers Securities (Singapore) Pte Ltd. ( DBSVS ) and DBSVHK, its respective connected and associated corporations and affiliates only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any means or (ii) redistributed without the prior written consent of DBSVHK. The research set out in this report is based on information obtained from sources believed to be reliable, but we (which collectively refers to DBS Bank Ltd., DBSVS and DBSVHK, its respective connected and associated corporations, affiliates and their respective directors, officers, employees and agents (collectively, the DBS Group )) have not conducted due diligence on any of the companies, verified any information or sources or taken into account any other factors which we may consider to be relevant or appropriate in preparing the research. Accordingly, we do not make any representation or warranty as to the accuracy, completeness or correctness of the research set out in this report. Opinions epressed are subject to change without notice. This research is prepared for general circulation. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This document is for the information of addressees only and is not to be taken in substitution for the eercise of judgement by addressees, who should obtain separate independent legal or financial advice. The DBS Group accepts no liability whatsoever for any direct, indirect and/or consequential loss (including any claims for loss of profit) arising from any use of and/or reliance upon this document and/or further communication given in relation to this document. This document is not to be construed as an offer or a solicitation of an offer to buy or sell any securities. The DBS Group, along with its affiliates and/or persons associated with any of them may from time to time have interests in the securities mentioned in this document. The DBS Group, may have positions in, and may effect transactions in securities mentioned herein and may also perform or seek to perform broking, investment banking and other banking services for these companies. Any valuations, opinions, estimates, forecasts, ratings or risk assessments herein constitutes a judgment as of the date of this report, and there can be no assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments. The information in this document is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed, it may not contain all material information concerning the company (or companies) referred to in this report and the DBS Group is under no obligation to update the information in this report. This publication has not been reviewed or authorized by any regulatory authority in Singapore, Hong Kong or elsewhere. There is no planned schedule or frequency for updating research publication relating to any issuer. The valuations, opinions, estimates, forecasts, ratings or risk assessments described in this report were based upon a number of estimates and assumptions and are inherently subject to significant uncertainties and contingencies. It can be epected that one or more of the estimates on which the valuations, opinions, estimates, forecasts, ratings or risk assessments were based will not materialize or will vary significantly from actual results. Therefore, the inclusion of the valuations, opinions, estimates, forecasts, ratings or risk assessments described herein IS NOT TO BE RELIED UPON as a representation and/or warranty by the DBS Group (and/or any persons associated with the aforesaid entities), that: (a) (b) such valuations, opinions, estimates, forecasts, ratings or risk assessments or their underlying assumptions will be achieved, and there is any assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments stated therein. Please contact the primary analyst for valuation methodologies and assumptions associated with the covered companies or price targets. Any assumptions made in this report that refers to commodities, are for the purposes of making forecasts for the company (or companies) mentioned herein. They are not to be construed as recommendations to trade in the physical commodity or in the futures contract relating to the commodity referred to in this report. DBSVUSA, a US-registered broker-dealer, does not have its own investment banking or research department, has not participated in any public offering of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months and does not engage in marketmaking. Page 21

22 ANALYST CERTIFICATION The research analyst(s) primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and their securities epressed in this report accurately reflect his/her personal views. The analyst(s) also certifies that no part of his/her compensation was, is, or will be, directly or indirectly, related to specific recommendations or views epressed in the report. The research analyst (s) primarily responsible for the content of this research report, in part or in whole, certifies that he or his associate 1 does not serve as an officer of the issuer or the new listing applicant (which includes in the case of a real estate investment trust, an officer of the management company of the real estate investment trust; and in the case of any other entity, an officer or its equivalent counterparty of the entity who is responsible for the management of the issuer or the new listing applicant) and the research analyst(s) primarily responsible for the content of this research report or his associate does not have financial interests 2 in relation to an issuer or a new listing applicant that the analyst reviews. DBS Group has procedures in place to eliminate, avoid and manage any potential conflicts of interests that may arise in connection with the production of research reports. The research analyst(s) responsible for this report operates as part of a separate and independent team to the investment banking function of the DBS Group and procedures are in place to ensure that confidential information held by either the research or investment banking function is handled appropriately. There is no direct link of DBS Group's compensation to any specific investment banking function of the DBS Group. COMPANY-SPECIFIC / REGULATORY DISCLOSURES 1. DBSVHK and its subsidiaries do not have a proprietary position in the securities recommended/mentioned in this report as of 31 Mar Neither DBS Bank Ltd, DBS HK nor DBSV HK market makes in equity securities of the issuer(s) or company(ies) mentioned in this Research Report. 3. Compensation for investment banking services: DBS Bank Ltd., DBSVS, DBSVHK, their subsidiaries and/or other affiliates of DBSVUSA have received compensation, within the past 12 months for investment banking services from China South City Holdings Limited (1668 HK), China Overseas Grand Oceans Group (81 HK), Yanlord Land Group Limited (YLLG SP), Yueiu Property Company Limited (123 HK) and Central China Real Estate Limited (832 HK) as of 28 Feb 217. DBS Bank Ltd., DBSVS, DBSVHK, their subsidiaries and/or other affiliates of DBSVUSA, within the net 3 months, will receive or intend to seek compensation for investment banking services from China Overseas Grand Oceans Group (81 HK) and China Jinmao Holdings (817 HK) as of 28 Feb 217. DBS Bank Ltd., DBSVS, DBSVHK, their subsidiaries and/or other affiliates of DBSVUSA have managed or co-managed a public offering of securities for China South City Holdings Limited (1668 HK), China Overseas Grand Oceans Group (81 HK), China Jinmao Holdings (817 HK), Yanlord Land Group Limited (YLLG SP) and Yueiu Property Company Limited (123 HK) in the past 12 months, as of 28 Feb 217. DBSVUSA does not have its own investment banking or research department, nor has it participated in any public offering of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months. Any US persons wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in this document should contact DBSVUSA eclusively. 4. Disclosure of previous investment recommendation produced: DBS Bank Ltd, DBSVS, DBSVHK, their subsidiaries and/or other affiliates of DBSVUSA may have published other investment recommendations in respect of the same securities / instruments recommended in this research report during the preceding 12 months. Please contact the primary analyst listed in the first page of this report to view previous investment recommendations published by DBS Bank Ltd, DBSVHK, their subsidiaries and/or other affiliates of DBSVUSA in the preceding 12 months. 1 An associate is defined as (i) the spouse, or any minor child (natural or adopted) or minor step-child, of the analyst; (ii) the trustee of a trust of which the analyst, his spouse, minor child (natural or adopted) or minor step-child, is a beneficiary or discretionary object; or (iii) another person accustomed or obliged to act in accordance with the directions or instructions of the analyst. 2 Financial interest is defined as interests that are commonly known financial interest, such as investment in the securities in respect of an issuer or a new listing applicant, or financial accommodation arrangement between the issuer or the new listing applicant and the firm or analysis. This term does not include commercial lending conducted at arm's length, or investments in any collective investment scheme other than an issuer or new listing applicant notwithstanding the fact that the scheme has investments in securities in respect of an issuer or a new listing applicant. Page 22