CNLLF - Central China Real Estate: Re-Rating Of Henan Property Play Dependent On Growth In Size
Elevator Pitch
Hong Kong-listed Mainland China property developer Central China Real Estate Limited (CNLLF) [832:HK] currently trades at 5.2 times consensus forward FY2019 P/E based on its share price of HK$3.34 as of August 30, 2019. This represents a significant discount to the stock's historical five-year average forward P/E of 7.6 times.
Central China Real Estate's valuation discount is due to its lack of scale and a lack of geographical diversification. The company is focused in Henan province, unlike most of its listed property developer peers with a nationwide presence. While the company