BEKE - KE Holdings May Have A Downside Potential Of Close To 50%

September, 11 2021 05:56 AM KE Holdings Inc American Depositary Shares (each representing three Class A)

KE Holdings offers an online and offline platform for housing transactions and services in China.
I wouldn’t buy shares. I found five reasons to be very cautious about KE Holdings.
The PRC seems to have announced several initiatives to promote that the housing industry is not controlled by speculators. The measures include restrictions on purchases along with different credit policies.
The PRC may impose the price of houses all over the country. In Shenzhen, authorities offer reference prices on existing home transactions. As a result, the total number of transactions decreased significantly.
I used a WACC of 20%, which implied a valuation close to CNY115 or $15. With all these figures in mind, if I have the shares, I would sell at $20 per share, and may buy at $10-$15.

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Company Name:	KE Holdings Inc American Depositary Shares (each representing three Class A)
Stock Symbol:	BEKE
Market:	NYSE
Website:	investors.ke.com