State Grid quit real estate business! Giant Luneng or welcome new shareholders

category:Finance
 State Grid quit real estate business! Giant Luneng or welcome new shareholders


At present, the real estate business of State Grid is mainly operated by two platforms, Luneng group and its related party, capital Weiye. Guangyu development, a listed company currently controlled by Luneng Group, fell 4.28% due to the sharp fall of the real estate sector on the 23rd.

Focus on main business

According to the report, the Party group of the company further focuses on the main responsibility and business, correctly deals with the relationship between strengthening, optimizing and expanding, and strives to achieve higher quality, more effective and more sustainable development.

First, determined to quit the real estate business. Actively report and communicate with SASAC on the main ideas, and urge SASAC to clarify the direction of rectification work. According to the opinions of SASAC, further improve the exit and transformation plan, and accelerate the rectification work.

Second, adhere to the combination of industry and finance and serve the main business. The scope of business shall be strictly controlled to avoid being divorced from the actual situation, the financial business list shall be formulated and issued, classified control and dynamic adjustment shall be implemented, and 55 consolidated, 49 expanded, 16 restricted and 40 prohibited businesses shall be defined. We will accelerate the operation of the East-West assistance funds, formulate detailed rules for investment management, improve the investment path and decision-making process, organize and carry out the first batch of fund operations, and help fight poverty as soon as possible. Continue to reduce investment in non main businesses. In 2019, the proportion of investment in non main businesses will be 1.1%, and the investment amount and proportion will be reduced compared with the previous year.

Third, accelerate the construction of industrial chain financial platform. Actively and steadily carry out financial innovation and application, strive to meet the financial needs of the main body of the industrial chain market, and promote the common development of the industrial chain. We will fully implement bid guarantee insurance, study the application of performance guarantee insurance and quality assurance insurance, reduce transaction costs, reduce the burden on real enterprises, and release 5 billion yuan of deposit. We will promote e-ticket, e-Loan and other electricity fee financial businesses, and strive to ease the financing difficulty and high cost of small and medium-sized micro enterprises, with a scale of more than 3.4 billion yuan.

Sneaking Big Mac

Luneng Group Co., Ltd. was founded in December 2002. It is a wholly-owned subsidiary of State Grid Corporation of China. Its core business focuses on real estate and energy. Luneng has 29 years of experience in urban development, covering 23 provinces and cities in China, with a total construction area of 13 million square meters, providing services for 300000 owners. Luneng group once ranked fifth in the top 100 real estate companies.

In 2011, after divesting thermal power and other businesses, SASAC added Luneng Group as one of the 21 enterprises whose main business is real estate, and Luneng group increased investment in real estate business. With huge land reserves in early years, Luneng Group has considerable land reserves in Hainan, Shandong, Beijing and Tianjin.

A research report of Tianfeng securities in 2017 once estimated that Luneng had not injected 20 million cubic meters of potential resources at that time (Hainan and Beijing had rich reserves), and the potential value of goods was nearly 400 billion.

Limited development

In recent years, Luneng Groups real estate business has basically lost its first mover advantage. After Vanke, Evergrande, country garden and other leading legions broke the scale threshold of 300 billion yuan, Lunengs sales scale has been hovering around 10 billion yuan in recent years. In 2017, the sales scale of Luneng Group reached 80 billion yuan. Since then, the annual sales amount has not been disclosed.

Many insiders pointed out that the long-lasting restructuring of Luneng group and Guangyu development, the concentration of land reserves in key regulatory areas and the outdated mode of large-scale market have seriously affected the development of Luneng group.

In a previous study, Kerui analyzed the distribution of Lunengs soil reservoir. Luneng real estate is mainly distributed in Chongqing, Chengdu and Yibin in the Midwest; Beijing, Tianjin and Jinan in the Bohai Sea; Sanya, Haikou and Wenchang in Hainan; Nanjing, Suzhou and Fuzhou in the new expansion. At the same time, a large number of land is located in key areas such as Hainan and Beijing, which also restricts the development of enterprises. In fact, Luneng Group is also trying to diversify in recent years. At present, it is vigorously developing seven innovative industrial systems of Commerce, culture and tourism, sports, health, science and technology, beautiful countryside and peoples livelihood. At the same time, Luneng Group also intends to gradually desalinate real estate in recent years, and has rarely acquired land in the open market. According to industry analysis, given the current size of Luneng group and the way in which non real estate major central enterprises dispose of the real estate sector before, it is not ruled out that Luneng Group will experience restructuring or be integrated into relevant real estate major central enterprises in the future. Source: Yang Qian, editor in charge of China Securities News nf4425

In a previous study, Kerui analyzed the distribution of Lunengs soil reservoir. Luneng real estate is mainly distributed in Chongqing, Chengdu and Yibin in the Midwest; Beijing, Tianjin and Jinan in the Bohai Sea; Sanya, Haikou and Wenchang in Hainan; Nanjing, Suzhou and Fuzhou in the new expansion. At the same time, a large number of land is located in key areas such as Hainan and Beijing, which also restricts the development of enterprises.

In fact, Luneng Group is also trying to diversify in recent years. At present, it is vigorously developing seven innovative industrial systems of Commerce, culture and tourism, sports, health, science and technology, beautiful countryside and peoples livelihood. At the same time, Luneng Group also intends to gradually desalinate real estate in recent years, and has rarely acquired land in the open market.

According to industry analysis, given the current size of Luneng group and the way in which non real estate major central enterprises dispose of the real estate sector before, it is not ruled out that Luneng Group will experience restructuring or be integrated into relevant real estate major central enterprises in the future.