Business Story: The AB Side Of Vanke

Four years ago, in 2017, Yu Liang was asked a question at the performance conference: if Vanke holds so much cash, will Vanke make difficult investments in the future, such as acquiring high leverage projects in trouble? Yu Liang's answer at that time was that we could help enterprises in difficulties, not take advantage of others' danger. We were helping enterprises in difficulties in the industry to tide over difficulties together. This is the responsibility of industry leaders.

At that time, Yu Liang had not become the chairman of the board of directors of Vanke, and Vanke did not shout out the "live" of subverting the industry. Maybe that scenario was just a deduction. Yu Liang might not have predicted that in 2021, four years later, Vanke would be the "gossip" object most wanted by troubled enterprises.

Vanke in the dream of troubled enterprises is the "White Knight" who can save them from the fire and water, and a master who can solve the crisis in the invisible. But sometimes this is only a unilateral expectation.

The management of Vanke, represented by Yu Liang, has the characteristics of "Owl", with "one eye to see opportunities and one eye to see risks". The style of professional managers determines that Vanke is one of the enterprises with the most strict investment discipline in the industry. The bottom line of any investment will be: it will not affect the shareholders' rights and interests, the shareholders' perception of this matter, and the income level of Vanke shareholders. Relying on this investment style, Vanke has not only gained the endogenous driving force in the main business, but also made up for the short board in the cross-border fields.

Therefore, we can see that in the recent market environment, Vanke has become one of the busiest Enterprises - it has copied many projects of Blu ray development, won the burden of "Diwang" of Huaxia happiness, and took over the 7.08% equity of Shenzhen hi tech investment held by Evergrande. In these deals, Vanke has fulfilled its commitment to shareholders, but to its counterparties, it is also a shrewd VC.

Dormant

Vanke has been criticized by investors for being too conservative in recent years.

In particular, when the radical rongchuang China rapidly rose to become China's top 4 real estate enterprises through mergers and acquisitions, Vanke, which has a large amount of cash, has not only delayed but also more stable development of scale. In this way, the former real estate leader is regarded as more cautious.

Even in Vanke's regional companies and city companies, it is often said that the group does not give enough space for investment development“ The card is very strict, and only projects with a profit margin of more than 10% can be taken. At present, there are few projects meeting such requirements. As soon as many projects are measured, there is no opportunity for them to participate. In recent years, it has been difficult for regions, and the performance can not be achieved, and the internal problems are more prominent. " A person from Vanke's southern region told the 21st century economic reporter.

Such an investment style has left Vanke with a good opportunity for faster scale development. Since 2016, the land price of the real estate industry began to rise. "Flour is more expensive than bread" phenomenon occurs from time to time. The "king of land" is frequent in hot cities. Vanke, which is never radical, remains cautious in the open market. The recognized and stable real estate enterprises such as China shipping and China resources can not help but take some high-priced land, but Vanke still resolutely avoids it.

Also around 2017, there were several "epic" mergers and acquisitions in the real estate industry. In addition to winning the 55.1 billion Guangxin asset package, which Wang Shi called the "gift bag to leave Vanke", Vanke rarely became the leading role because of becoming the "White Knight" of other enterprises. A Vanke insider said at this time that "as soon as others want to sell, they will go to rongchuang to find old sun, and not many people will think of looking for Vanke."

The open market and the careful conduct of merger and acquisition made Vanke once "latent". On the whole, Vanke's sales have increased steadily in recent years, but the increase is not obvious. The annual sales of Vanke from 2018 to 2020 are 606.95 billion yuan, 630.84 billion yuan and 704.15 billion yuan respectively, with growth rates of 14.5%, 3.9% and 11.6%.

Vanke is not lack of money, but do not want to buy. In recent years, Vanke's cash flow has remained abundant for a long time, and there are a lot of cash lying on the account, but they just don't hand out at will. According to the latest figures disclosed, by the end of 2020, Vanke's cash on hand was 195.2 billion yuan, the highest level in recent years.

Yu Liang has repeatedly responded to investors' queries in this regard. His view is that many people accuse us of being too conservative. We must make cash king and have surplus food in hand to better meet various challenges.

Wait for the wind to come

Finally, Yu Liang waited.

In the past few months, blue light is the real estate enterprise that has the most intersection with Vanke, and Vanke is constantly collecting the high-quality projects of the latter.

According to the 21st century economic report, in late May, 53.17% of the equity of Wuxi Hejun Real Estate Co., Ltd., a subsidiary of Blu ray, was transferred to Changzhou Vanke. The total amount of land acquisition corresponding to the four projects in the asset package may be about 3-3.5 billion yuan; In late June, Bluelight Wenzhou Xinlan Real Estate Co., Ltd. was acquired 100% equity by Vanke, involving 2.065 billion yuan of Ningbo Haishu plot in the asset package; On June 30, Blu ray development sold two projects in Shijiazhuang and Chongqing to Vanke, with transaction consideration of about 500-600 million yuan.

Since then, Vanke has taken the Blu ray Chengdu Tianfu Black Diamond project into consideration. Tianfu black diamond is the top product of Blu ray in Tianfu new area, which is positioned as a luxury house. This project is one of Blu Ray's most high-quality assets.

Vanke and Blu ray trading of these projects, in the industry, is extremely cost-effective. Take the blue light Shijiazhuang project obtained by Vanke as an example. In 2020, Blu ray paid a premium rate of 99.75% to obtain Shijiazhuang project, with a transaction amount of 793 million yuan. However, the price sold to Vanke was discounted a lot.

On July 27, Vanke once again "picked up the leak" and took over the shangyuanfu project of peacock city in Jiangning, Nanjing. This is the "Diwang" project won by Huaxia Xingfu in 2016. At present, three residential buildings have been completed and the community facilities have been basically completed, waiting for listing.

Whether it is Blu ray or Huaxia happiness, the above transaction is undoubtedly beneficial to Vanke. Vanke does not need to bear too much burden, nor does it carry out credit endorsement for the other party, so the transaction can be done smoothly and cleanly.

For shareholders, Vanke management is trustworthy, and its ability to control opportunities and risks is indeed impeccable. However, it is very complicated for the counterparties to deal with Vanke.

According to the 21st century economic report, the reporter communicated with several trading parties of Vanke. In their impression, Vanke is a delicacy who is hard to give in“ It is more likely that Vanke can't negotiate with Vanke on land acquisition cooperation than other enterprises. " A person who had planned to cooperate with Vanke in the project pointed out.

We are happy to deal with and do business with sun Hongbin of rongchuang, because this northern man is bold, polite and informal, and can give the other party enough dignity in the transaction, while Vanke is only talking about a business“ Vanke's help to others will not add chaos to itself, "said Vanke president Zhu Jiusheng, who has already said everything.

Building giant ships

Vanke's investment logic is not just speculation in seeking opportunities to "copy the bottom".

It is prudent and alert in the real estate industry. After all, there are few enterprises in this industry that have eaten up the land and financial dividends, are reckless and extensive, and have good investment discipline and excellent operation ability. Most of the time, the potential opportunities may also contain huge risks, and the leak detection will become a stepping stone. This is a situation that Vanke is not willing to accept.

In other diversified fields, Vanke can be relatively open and calm.

Take Vanke's best diversified plate cloud as an example. Its idea is to be the "shell" of the property industry. All things cloud needs to do is a platform. Therefore, it is open to peers and expects more member enterprises to join in.

On August 6, sunshine city announced that all the shareholders of Shanghai Sunshine Zhibo life Service Group Co., Ltd., a holding subsidiary, intend to invest in all things cloud by holding 100% shares of sunshine Zhibo, and exchange for 4.8% shares of all things cloud.

When commenting on the deal, Zhu Baobao, partner of Vanke Group and CEO of all things cloud, said that cash was "ashore" and stock exchange was "boarding". Xu Jianjing, Secretary of the board of directors of sunshine city, said that Yangguang Zhibo didn't go public alone, but exchanged shares for 4.8% to cooperate with all things cloud, which is the capital premium brought by the industry leader Aiwu cloud.

Looking forward, the cooperation between Vanke and Shenglong property is similar. Shenglong property is the first "experimental product" listed on the cooperation platform of "Rui alliance" of all things cloud. Zhu Baobao once said in an interview with the media including the 21st century economic reporter that the future listing of Shenglong property will be its strategic shareholder and technology service provider.

There are already enough passengers on the ship. The cooperative object of cloud of all things is not necessarily to make it obtain considerable return on investment in a short period of time. It is willing to look into the future and try more ways to play as long as it can attract more boat people.

In the logistics industry, Vanke is also based on "circle of friends". In 2018, Vanke led a consortium composed of Houpu, hillhood capital, SMG and BOC Group Investment Co., Ltd. to complete the privatization acquisition of pros, with a shareholding of 21.4%. After that, Vanke has rapidly formed a scale in the logistics industry. At present, wanwei logistics under Vanke is already the second largest logistics enterprise in mainland China.

Property, logistics, this is the management of Vanke praised the diversification plate. Their investment ideas, to a certain extent, reflect the business logic of Vanke in cultivating the "second growth curve" in recent years.

I still remember that in 2018, when Zhu Jiusheng took office as president, he was asked whether Vanke would become the "Blackstone of China". Zhu Jiusheng said that Yu Liang once shared with us that if we simply learn from others, it will always be just catching up and can not be surpassed. In a great era and country, we should make some meaningful explorations and learn from them.

Whether Vanke will be "China's black stone" is not important, because it has explored a strong Vanke style investment model. Many years ago, Vanke was the "elitist" in the industry. After many years, Vanke's style is still smart and exquisite. Enterprises or assets that want to be acquired must understand this truth.