Yuzhou Properties : Credit Suisse Revised up the Target Price of Yuzhou Properties to HK$3.10 and reaffirmed "Outperform" rating

The Group delivered a set of solid interim figures with core profit/EPS up 19.0%/10.3% YoY to RMB657 million/RMB

0.17. Gross Profit margin remained high at 32.5%, thanks to contribution from its high-margin home-based Fujian Province and the recovering Hefei city. Credit Suisse revised the full-year sales estimate to RMB22 billion from RMB18 billion, and revised up FY16E/17E/18E EPS by 13%/12%/10% given intact GP margin of over 30%. Credit Suisse thinks that Yuzhou should be able to safeguard the earnings quality amid fast growth in scale.

Slightly positive cash flow of Yuzhou was recorded over 1H16 and expected similar cash flow situation for the full year. This should support its high dividend payout of 35%, converting into dividend yield of 8.4%. Credit Suisse revised up NAV by 13% to HK$7.8 in the backdrop of better-than-expected sales and margin. By applying 60% targeted discount, Credit Suisse gave new Target Price of HK$3.10 and Yuzhou remains one of its top picks among mid small caps.

In addition, Credit Suisse also specifically summarized the prospects for the future of Mr. Lam Lung On, Chairman of Yuzhou Properties: Chairman expressed his optimism to achieve FY16 contracted sales target. With the company's headquarters moved to Shanghai, he also stressed the company's strategy of focusing on the Yangtze River Delta.

Looking forward, Lam Lung On, Chairman of Yuzhou Properties states: "The Group will continue to leverage better corporate governance and management structure, prudent financial policies, as well as the spirit of 'Building Cities with Heart, Building Homes with Love', and dedicated to achieve maximum value for shareholders and investors, to create the best return. Uphold the Group strategy of 'Based on the Yangtze River Delta, Lead West Strait and Expand Nationwide Coverage' and continuously deepen six core cities footprint. With the strong growth in sales contracts and financing costs continue to decrease, adhere to customer-centric, and constantly promote products and services to upgrade and expand business territory."

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About Yuzhou Properties Company Limited (01628.HK)

Yuzhou Properties Company Limited is a national property developer which based in Shanghai, continuously deepen six core cities. Yuzhou Properties strives to become a leading property developer in China with a well-defined expansion strategy as Based in Yangtze River Region, Lead West Strait and Expand Nationwide Coverage.

Established in 1994, Yuzhou Properties specializes in the development of high quality residential, retail and commercial projects. As at 25 August 2016, the Company had 61 projects under various stages of development in Xiamen, Fuzhou, Shanghai, Tianjin, Nanjing, Hefei, Hangzhou, Quanzhou, Zhangzhou, Longyan, Bengbu and Hong Kong. Sites measuring a total GFA of over 9.04 million sq. m. are under development or held for future development, West Strait Economic Zone, Yangtze River Delta Region and Bohai Rim Region accounting of 44%, 53% and 3% respectively. Known for its outstanding product quality and diversified product portfolio, strong brand awareness and its experienced management team, Yuzhou Properties has been named "Top 100 China Real Estate Enterprises" for ten consecutive years; and Top 50 China Real Estate Enterprises from 2011 to 2015. "Yuzhou" brand has been recognized by the State Administration for Industry and Commerce as a "Renowned Brand in China" and a "Famous Brand" by the Fujian provincial government and the Xiamen municipal government.

For more information about Yuzhou Properties, please visit the company's website: http://www.xmyuzhou.com.cn

Please feel free to contact us if you have any enquires:

Wonderful Sky Financial Group Holdings Limited (HKEX: 01260) Sylvia Deng/ Shirley Chong

Tel: (852) 3970 2238/ 3970 2129/ 3970 2223

Fax: (852) 2598 1588

Email: po@wsfg.hk/ sylviadeng@wsfg.hk/ shirleychong@wsfg.hk