Reiterate Buy – Nov contract sales reaching Rmb6.1bn

Following the record high contract sales in Oct (Rmb6.4bn), Country Garden (CG)reported another month of robust sales in November which reached Rmb6.1bn,better than our expectation of Rmb5-6bn only as discussed in our last note. It’sworth noting that the November figure was the second highest in CG’s history,just behind the record high in the preceding month (Chart 1). In addition, CG’sNovember contract sales ASP also increased by 6.4% MoM to Rmb6,548/sqm.

That was a good level of ASP, considering that CG’s contract sales ASP was onlyat Rmb6.3k/sqm in 2011 and at Rmb6.2k/sqm in 11M12. We believe that the highASP achieved in November can be attributed to the higher selling priced achievedfor a few new launches, such as Phoenix City Jinan, etc. We reiterate Buy on CG,with a PO of HK$4.5.

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