Poly Real Estate Group:Data Update,Minor changes to estimates and TP

Changes and Implications.

We revise our 2016E-2018E EPS by -1%/-3%/+5% and our 12-month targetprice by +3% to Rmb11.0 to account for the latest land acquisitions andmargin trend. We do not view these changes as material, and there is nochange to our investment thesis or rating.

Valuation.

Our 12-month target price is based on 10% discount to end-16E NAV ofRmb12.17 (was Rmb11.85). The stock is trading at 22% discount to end-16ENAV, 7.7X 16E P/E, 1.2X 16E P/B vs. onshore average of 26%, 11.0X and1.9X. We view the valuation attractive and maintain CL-Buy.

Key risks: Weaker-than-expected property sales performance; marginrecovery below expectations; macro hard landing.