Company Reports

China Overseas Land & Investment's revenue and operating profit rose 17% and 15% year on year, respectively, in the first half of 2026. The firm expects property sales value and average selling prices to grow in 2026. The interim dividend dropped to HKD 0.23 per share from HKD 0.25 in 2025.

As housing demand cools and credit growth slows, we believe leverage-driven sales growth for China real estate developers is behind us. That said, we think large developers such as China Overseas Land & Investment will fare well as the industry consolidates, with smaller peers facing increasing liquidity constraints and slumping sales volume. During market downturns, COLI has been one of the few developers to achieve market share growth through focusing on landbank quality upgrades and opportunistic acquisitions.

Major Chinese property developers, including state-owned China Overseas Land and Investment and China Resources Land, have had 15%-25% gains in share prices since April 28. That said, the sales value of the top 100 developers slid by 19% year on year in January-April 2026, per third-party data.

As housing demand cools and credit growth slows, we believe leverage-driven sales growth for China real estate developers is behind us. That said, we think large developers such as China Overseas Land & Investment will fare well as the industry consolidates, with smaller peers facing increasing liquidity constraints and slumping sales volume. During market downturns, COLI has been one of the few developers to achieve market share growth through focusing on landbank quality upgrades and opportunistic acquisitions.

China Overseas Land and Investment's first-quarter revenue rose 1% year on year. However, operating profit declined by 27% due to weaker margins of delivered units. Forward sales momentum remained solid, with contracted sales up 11% on strong demand in affluent cities.

As housing demand cools and credit growth slows, we believe leverage-driven sales growth for China real estate developers is behind us. That said, we think large developers such as China Overseas Land & Investment will fare well as the industry consolidates, with smaller peers facing increasing liquidity constraints and slumping sales volume. During market downturns, COLI has been one of the few developers to achieve market share growth through focusing on landbank quality upgrades and opportunistic acquisitions.

China Overseas Land & Investment's revenue and operating profit declined by 9% and 26% year on year, respectively, in 2025. While softer pricing of presold properties weighed on margins, COLI's land investment rose 47% to CNY 119 billion, with most new parcels in wealthy regions of China.

According to the National Bureau of Statistics, China's new home sales value declined by 11% year on year in January-November 2025. At the recent Central Economic Work Conference, the government reiterated its commitment to stabilizing the property market and clearing excess housing inventory.

As housing demand cools and credit growth slows, we believe the leverage-driven strong growth for China’s real estate developers is behind us. That said, we think large developers such as China Overseas Land & Investment, or COLI, will fare well as the industry consolidates, with smaller peers facing increasing liquidity constraints and slumping sales volume. During market downturns, COLI has been one of the few developers to achieve market share growth, through focusing on landbank quality upgrades and opportunistic acquisitions.

China Overseas Land and Investment saw 13% and 52% year-on-year decreases in revenue and operating profit, respectively, in the third quarter of 2025. Conversely, contracted sales (mostly presales) held steady, while land investment surged by over sevenfold to CNY 60.5 billion.

China Overseas Land and Investment, or COLI, saw revenue and operating profit decline by 4% and 29%, respectively, in the first half of 2025. This is ascribed to weak profitability of projects presold in prior years, leading to gross margin contraction to 17.4% from 22.1% in the year-ago period.

As housing demand cools and credit growth slows, we believe the leverage-driven strong growth for China’s real estate developers is behind us. That said, we think large developers such as China Overseas Land & Investment, or COLI, will fare well as the industry consolidates, with smaller peers facing increasing liquidity constraints and slumping sales volume. During market downturns, COLI has been one of the few developers to achieve market share growth, through focusing on landbank quality upgrades and opportunistic acquisitions.

According to China Real Estate Information Corp, the top 100 real estate developers in China saw an 11% year-on-year contracted sales decline for the first half of 2025. However, their aggregate land premium paid grew by over 30% for the same period.

As housing demand cools and credit growth slows, we believe the leverage-driven strong growth for China’s real estate developers is behind us. That said, we think large developers such as China Overseas Land & Investment, or COLI, will fare well as the industry consolidates, with smaller peers facing increasing liquidity constraints and slumping sales volume. During market downturns, COLI has been one of the few developers to achieve market share growth, through focusing on landbank quality upgrades and opportunistic acquisitions.

China Overseas Land and Investment reported flattish revenue and a 15% year-on-year decline in operating profit for first-quarter 2025. Its landbank premium paid surged to CNY 27.3 billion from CNY 1.6 billion a year ago.

As housing demand cools and credit growth slows, we believe the leverage-driven strong growth for China’s real estate developers is behind us. That said, we think large developers such as China Overseas Land & Investment, or COLI, will fare well as the industry consolidates, with smaller peers facing increasing liquidity constraints and slumping sales volume. During market downturns, COLI has been one of the few developers to achieve market share growth, through focusing on landbank quality upgrades and opportunistic acquisitions.

China Overseas Land and Investment posted weak numbers for 2024 as revenue and operating profit declined by 9% and 34% year on year, respectively. However, the firm's balance sheet remained healthy, with a 29.2% net gearing ratio for 2024 versus 38.7% for 2023.

The 2024 Central Economic Work Conference, or CEWC, held on Dec. 11-12 reaffirmed benign measures to stabilize China's home market and mitigate the industry's financial risks. Other key themes include unleashing property demand potential and expediting inventory absorption.

China Overseas Land & Investment’s third-quarter 2024 results were disappointing, as revenue and operating margin both deteriorated versus the same period last year. We think this was due to anemic property presales and subdued prices since 2023, which have weighed on COLI’s near-term profit. However, the policy-induced rebound in COLI’s contracted sales (mostly presales) in October reassured us that the company should see a progressive recovery in earnings over time. While we lower our 2024 revenue and operating profit forecasts by 3% each, we maintain a constructive outlook of a mid-single-digit earnings compound annual growth rate for 2023-28. This leads to an unchanged HKD 21 per share fair value estimate, and we still view COLI’s shares as undervalued, underpinned by its robust financial health and attractive valuation.

As housing demand cools and credit growth slows, we believe the leverage-driven strong growth for China’s real estate developers is behind us. That said, we think large developers such as China Overseas Land & Investment, or COLI, will fare well as the industry consolidates, with smaller peers facing increasing liquidity constraints and slumping sales volume. During market downturns, COLI has been one of the few developers to achieve market share growth, through focusing on landbank quality upgrades and opportunistic acquisitions.