Deutsche Bank reiterates price hike to 105 dollars for house purchase

On the evening of January 8 Beijing time, Deutsche Bank released its research report today, reiterating its "buy" rating on Nyse:sfun shares and raising its target share price to $105 trillion.

The following is the full report:

Expected to achieve more sustainable growth

After several consecutive quarters of "Better-than-expected share prices", we believe the House will still be in high growth, while China's real estate market remains strong for 2014 years. Based on favourable market expectations, we believe that the growth of house search will continue to be driven by the start-up phase of the electricity business. In addition, some new projects, such as the commercialization of mobile services and the introduction of financial products, may accelerate the development of traditional advertising business. Despite the sharp rise in stock prices over the past 12 months, we still believe that the future of the House will be repositioned and the expected performance will be raised. Reaffirm the "buy" rating.

Electrical business: Lead the competition, long-term growth

We expect the electricity market to maintain long-term growth in 2014. As a result of the increase in permeability, some of the key companies will increase market share. At the same time, competition is likely to be fierce, which will push the market into the threshold. As the largest online real estate vertical site, the past two years have been successful in using its user traffic, from the simple advertising business to lead the marketing/electric platform. We believe that the strong position built up by developers over the past two years will continue to bring advantages to house search, thus winning more projects and covering more regional markets.

New project to promote traditional advertising business

Although the traditional advertising business has been affected by the development of the electric business, and encountered the problem of online advertising saturation, but we expect that some of the new projects will ease the risk. Search Room mobile Applications (1.2 million active users, accounting for about 27% of total traffic) since the end of 2013 has been The advertiser's good acceptance, so the thousands of ads display price (RPM) will also appear quarterly growth. In addition, the recent launch of the financial platform is likely in the 2014 fiscal year revenue growth accounted for 3% to 5%.

The target price was raised by 44% to $105, reaffirming the "buy" rating

After seeing positive growth prospects, we will be looking for 2013, 2014, 2015 fiscal year revenue estimates are up by 0.3%, 3% and 8% respectively, the 2013, 2014, 2015 fiscal year for each share of ads share earnings expected to increase by 1%, 10% and 15%. Our new target share price is 105 US dollars (up 44%), based on: 1 The city's profit growth ratio (PEG) is 1 times times unchanged; 2) The annual compound growth rate of shares in ads per share in 2014-2016 was 24.7%, higher than the previous estimate of 18.7%. The target price is equivalent to 24.7 times times the prospective price-to-earnings ratio for fiscal year 2014, and valuations remain attractive compared with the average of 32 times times that of Chinese internet companies. Key risks include: the status of the real estate market, market competition.