March 10, 2025 01:26 GMT
EM ASIA CREDIT: Longfor (LNGFOR: Ba3Neg/BB-Neg/BBNeg)
EM ASIA CREDIT
Longfor (LNGFOR: B1/BB-/BB)
“*LONGFOR GROUP SEES 2024 CORE NET PROFIT DOWN ABOUT 35% TO 40% “ BBG
- Longfor announces profit warning after market close Friday. The company now expects core net profit to be down 35%-40% compared to Dec. '23 (RMB11.35bn). The new estimates are also below Bloomberg consensus, which called net income down 20% YoY.
- The main driver, unsurprisingly, is the downturn in the real estate industry and related margin pressures.
In terms of valuations, investors may look through the profit warning and focus on an underlying improvement in sentiment within the real estate sector, which is seeing support from central government.
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