Morgan Stanley issued an investment report today to give SouFun stock an initial rating

The following is a summary of the contents of the report:

House search has become China's leading online real estate platform, in the advertising market share in the dominant position. House-Search listings and E-commerce services have driven the company's business diversification and become a driving force for revenue growth.

Potential market: China's online real estate market is far from mature, currently accounting for only 20% to 25% of online marketing budgets, compared with 50% to 60% in the US. In China, house search occupies 2/3 of the online real estate advertising market. With the popularity of the internet and mobile internet, advertising marketing budget will be transferred from offline to online, and house search will benefit from it.

Revenue Growth drivers: In addition to online brand advertising services, house search listings, E-commerce and mobile services continue to grow, and bring more revenue. Currently, the listing revenue accounted for 25% of total revenue, e-commerce revenue accounted for the total revenue of 30%.

Revenue steady growth: Search house revenue steady growth, 2010 to 2013 annual growth rate of about 38%. During this period, net profit margin increased from 28% to 47%, mainly thanks to the promotion of commercial level, the optimization of business portfolio and the operation of leverage.

Risk: 1 China's real estate market turmoil and potential economic downturn; 2. The challenge facing the competition in the advertising market.

Valuation: We give SouFun stock "overweight" initial rating, set the target stock price to 120.90 US dollars.