Strong 1H17 results as shown in core profit growth of +59% yo-y; interim dividend was up 111% y-o-y
　　Active landbank addition of 44 projects （total 12.56m sqm）with c60% exposure to top-tier cities to underpin future growth
Maintain Buy with a revised TP of HKD5.50 （from HKD4.40）
Another developer of strong 1H17 results. Sino-Ocean became another developerdelivering better-than-expected interim results, with revenue up by 85% y-o-y toRMB17bn and core profit up by 59% y-o-y to RMB1.52bn. While net gearing（excluding restricted cash） has jumped to 78% （vs. 56% as of end-16）， thecompany’s financing cost further decreased to 5.07%, 31bps lower than FY16. Sino-Ocean also announced a 1H17 dividend of HKD0.167 per share, +111% y-o-y.
　　Visible growth backed by ample landbank. Sino-Ocean saw a 48% y-o-y growth in1H17 contracted sales and revised up its FY17 target by 17% to RMB70bn. Although theFY17 implied growth rate of 39% does not appear as ambitious as some of its peers, weexpect Sino-Ocean’s contracted sales growth to sustain into FY18 given its abundantland resources. Year to date, the company has added 44 new projects （total GFA 12.56m sqm） to its landbank, c60% of which is located in tier-1 and 2 cities. After its activeland parcel purchases, Sino-Ocean currently owns total landbank of c40 m sqm （c20 msqm attributable）。 Furthermore, during the analyst briefing, management struck apositive tone on its growth outlook and stressed the focus on profitability through marginimprovement （1H17 property sales gross margin of 27%）。 We believe the company iswell positioned to regain growth momentum.
　　Maintain Buy with a revised TP of HKD5.50 （from HKD4.40）。 We expect to seepotential business acceleration of Sino-Ocean and improving margins （FY17-19eGPM of 23-24% under our estimate） and thus maintain our Buy rating on thecompany. After factoring in new land acquisitions, we revise up our NAV estimate toHKD13.80 （vs. HKD11.10）。 Our TP is revised to HKD5.50 （vs. HKD4.40）， based onan unchanged target discount of 60% （0.5 SD below historical mean） to our revisedNAV estimate. Key downside risks include lower-than-expected contracted salesgrowth, overspending on new land acquisitions, any material slowdown of newbusiness initiatives, and uncertainties related to macroeconomic and propertyspecificpolicies.