Yuzhou Properties : Huatai Upgrades Yuzhou Properties to “BUY” with a Raised Target Price of HKD4.1 in view of its Strong Sales Momentum with High Dividend Yield

(19 May 2017, Hong Kong) Yuzhou Properties Company Limited ("Yuzhou Properties" or the "Company", together with its subsidiaries referred to as the "Group"; stock code: 01628.HK), is pleased to announce that Huatai Research ("Huatai") believed Yuzhou Properties, as a high dividend player with solid fundamentals, given improvement in the sales/margin balance, is well positioned in China's property market. At the same time, driven by three factors: 1) continuing strong sales momentum in 2H17E; 2) sustained margin due to Yuzhou Properties' disciplined land-acquisition strategy; and 3) high dividend yield attracting southbound money, the target price of Yuzhou Properties was raised to HKD4.1 and the ratings has been upgraded to "Buy".

4M17 contracted sales of Yuzhou Properties bit Huatai's / consensus estimate as it reached RMB14 billion, which was already 47% of its full-year sales target of RMB30bn in 2017. Huatai strongly believed the Company would easily surpass its sales target for 2017 with strong sales momentum from its next round of new projects in Shanghai, Hangzhou and Suzhou.

Under the condition of land tightness in some top-tier cities, the land cost was staying high yet Yuzhou Properties' selective land-banking strategy provide a low pressure on its margin. Until now in 2017, the Company had already acquired 5 land parcels in cities of which housing demand was resilient, such as Tianjin, Zhangzhou and Suzhou. Huatai expected Yuzhou's gross profit margin to remain in an industry-leading position, at 36%, 34.7% and 34% in 2017E, 2018E and 2019E respectively.

Huatai expected southbound money to be drawn to Yuzhou's attractive 2017E dividend yield

of 7.5%. The Company stated it would start distributing an interim dividend in 2017, based on solid cash flow, in an investor's meeting held by Huatai. Huatai believed growing appetite for dividend would drive a re-rating.

Huatai raised the end-2017E per-share NAV estimate to HKD6.8, based on NAV accretion and gathering sales momentum. Together with the sustained high profit margin and generous dividend yield, Huatai raised the target price to HKD4.1 and upgraded the ratings to "Buy".

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About Yuzhou Properties Company Limited (01628.HK)

Yuzhou Properties Company Limited is a national property developer, which is based in Shanghai and continuously expands its business in eight 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 31 Dec 2016, the Company had 68 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 9.54 million sq. m. are under development or held for future development, Yangtze River Delta Region, West Strait Economic Zone, Bohai Rim Region and Central Region accounting of 53%, 36%, 5% and 6% 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 years in a row; and Top 50 China Real Estate Enterprises from 2011 to 2016.

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

For inquiries, please contact:

Yuzhou Properties Company Limited (HKEX: 01628)

Head / Manager / Assistant Manager / Assistant Manager of Corporate Finance & Investor Relations

Camille Xiong/ Shikai Wu/Christine Huang/Jessica Li Tel: (852) 2508 1718

Fax: (852) 2510 0265

Email:

camille.xiong@xmyuzhou.com.cn; shikai.wu@xmyuzhou.com.cn ; huangl3@xmyuzhou.com.cn ; jessica.li@xmyuzhou.com.cn

Yuzhou Properties Investor Relations QR Code:

Wonderful Sky Financial Group Holdings Limited (HKEX: 01260) Iris Au Yeung/ Shirley Chong/ Mel Lai

Tel: (852) 3970 2129 / 3970 2223/ 3641 1305

Fax: (852) 2598 1588

Email: po@wsfg.hk/ yuzhou@wsfg.hk