CLSA 里昂证券-土地增值税及基建

01.18 11页 pdf

Local tax bureaus in China will start LAT
settlement next month. The essence of the move is to discourage and
restrain development of high end products and force a supply shift to the
mass market. Actual settlement of LAT will reduce future operating cashflow
for all developers. In addition, this will also offset some of the benefits from
corporate tax reduction in 2008. High-end developers will suffer most.
Developers without sufficient provisions may also suffer negative earnings
surprise in 2007. Given future policies may lead to further weakness and
volatility in the sector, we reiterate our tactical Underweight call and suggest
investors avoid/reduce high-end developers such as Shimao, Shui On,
Shanghai Real Estate and