Direct from Earnings Call | Zhao Shang Jiji Chairman Lü Bin: The Company's Development Goal During the "15th Five-Year Plan" is to "Strive for Three, Secure Five," with Focus on Enhancing Service Quality and Refined Operations

Everyday Reporter | Chen Ronghao
Everyday Editor | Yang Jun

On the afternoon of March 18, China Merchants Property Development (SZ001914, stock price 10.25 RMB, market value 10.801 billion RMB) held its 2025 annual performance release conference. The company’s Chairman Lu Bin, along with Directors and General Manager Chen Zhiheng, Director and Deputy General Manager Zhao Xiao, Deputy General Manager Wen Yanhong, CFO Jiang Xia, and Board Secretary Chen Jiang attended.

Lu Bin stated at the performance conference, “During the 14th Five-Year Plan period, the company has established the development goal of ‘Strive for Third, Secure Fifth.’ The core focus will be on enhancing service quality and refining operational management, continuously driving high-quality development of the enterprise.”

Scene from China Merchants Property Development’s 2025 Performance Conference | Photo by Chen Ronghao, Everyday

Lu Bin mentioned that the property management industry has shifted from a growth market to a stock competition, with both opportunities and challenges. During the 14th Five-Year Plan, expanding and strengthening light asset businesses will become the company’s core task. As an important light asset operation platform of China Merchants Shekou, China Merchants Property Development aims to become China’s leading property asset management and operation provider.

“‘Strive for Third, Secure Fifth’ is not only about industry rankings but also about forging the company’s core capabilities,” Lu Bin said. “Only by focusing on refined service and operational excellence, improving service quality, and earning owners’ trust can we secure our position in fierce competition.”

Regarding the support from China Merchants Shekou, Lu Bin explained that the group will prioritize business synergy and value-added services. China Merchants Property Development will fully undertake the comprehensive services for the backend development of China Merchants Shekou, while also strengthening integration in areas such as ‘Property + Elderly Care,’ ‘Home Services,’ and ‘Livable Communities,’ covering the entire lifecycle of customer needs. Additionally, the group will promote cooperation between various secondary sectors and China Merchants Property Development, providing brand and resource support for market expansion.

Lu Bin added that future efforts will focus on upgrading basic service standards, strengthening community operations, and enhancing owners’ work and living experiences through soft connections.

When discussing the market space and opportunities in the non-residential property sector, Zhao Xiao, Vice President of China Merchants Property Development, noted that in recent years, with policy liberalization, the establishment of property management committees and owners’ committees has accelerated, unlocking significant market potential. The company’s third-party new contract signing amount for 2025 is expected to reach 4.169 billion RMB, a year-on-year increase of 12.89%.

According to the company’s annual report, as of the end of 2025, the residential business accounted for 22.54% of total revenue, with a gross profit margin of 11.36%, up 0.48 percentage points year-on-year; non-residential business accounted for 54.21%, with a gross profit margin of 10.15%, down 0.44 percentage points year-on-year.

Regarding the rise in residential gross profit margin and the decline in non-residential gross profit margin, Chen Jiang, Board Secretary, explained that property management is a basic service with strong public service attributes. As the industry moves toward marketization, overall industry gross profit margins are declining, leading more companies to exit unprofitable projects. China Merchants Property Development emphasizes cash flow and quality improvement, actively working to enhance profitability.