Peeping Report | China Merchants Zhaoye Revenue "Double-Digit" Growth, 2025 Solidifies "Capability Foundation"

Source: Feng Cai Xun

According to industry data, the trend of property management entering the stock era is deepening. As scale dividends weaken, most property companies are shifting their business strategies to focus more on sustainable development. On the evening of March 13, China Merchants Property Development (001914.SZ) disclosed its 2025 annual report. In an environment full of industry challenges, steady progress has become the main theme for China Merchants Property Development throughout the year.

During the reporting period, revenue reached 19.273 billion yuan, a year-on-year increase of 12.23%, achieving double-digit growth. Due to a one-time disposal of the Hengyang project, net profit attributable to shareholders decreased by 256 million yuan, down 22.12% year-on-year. This effectively resolved issues related to the company’s involvement in real estate, helping to activate assets and optimize long-term development structure, allowing for a lighter operational load. Excluding this one-time factor, China Merchants Property Development’s net profit attributable to shareholders in 2025 was 910 million yuan, up 8.30% year-on-year, demonstrating a solid operating foundation and a clear long-term strategic focus.

Meanwhile, the company’s financial footing remains solid, with ample liquidity. Data shows that at the end of the year, China Merchants Property Development had 5.623 billion yuan in cash and equivalents, up 20.39% year-on-year; interest-bearing debt was 517 million yuan, down 37.94%, with a continued optimization of debt structure; accounts receivable growth was slower than revenue growth, indicating improved capital turnover efficiency; operating net cash flow reached 1.641 billion yuan, performing well and strengthening its competitive moat for future development.

As of the end of 2025, the company managed 2,473 projects, with a management area of 377 million square meters. During the year, it signed new annual contracts worth 4.48 billion yuan, with both operational scale and management quality continuing to grow.

CRIC Property Management pointed out that by the end of the 14th Five-Year Plan, the market had completed a new round of “value revaluation,” shifting valuation logic from “growth stocks” to “value stocks.” Investors now pay more attention to a company’s cash flow stability, dividend payout ability, and profitability quality. The core of competition has shifted to “quality” and “efficiency,” emphasizing service quality, customer satisfaction, project output value, and technological empowerment.

Strengthening “Capability Foundation”

Enhancing Quality and Efficiency to Gain Market Recognition

A detailed analysis of China Merchants Property Development’s annual report reveals a clear focus on “capability enhancement.” Especially in the current environment where the property management industry faces pressures such as “customer satisfaction,” declining property fees, and lower collection rates, improving quality and efficiency to achieve “value for money” is an inevitable choice. To command higher prices, management efficiency and service quality must keep pace.

Therefore, in recent years, China Merchants Property Development has increased investment in improving management standards, optimizing cost and procurement management, building high-quality service systems, deepening digital intelligence, and strengthening brand development.

In particular, in cost and procurement management, the company has established a full-cycle management system covering “pre-investment guidance, project verification, post-investment monitoring,” completed cost standards for key areas such as “core three guarantees, elevator maintenance, energy consumption,” and fully covered residential formats. It has also built a dynamic governance mechanism called “standard dashboard,” effectively promoting lean cost control and operational efficiency.

In terms of quality, the company focuses on establishing a high-quality service ecosystem, working on both “non-residential and residential” sectors. For example, the non-residential sector led the release of the “industry’s first national standard for customer satisfaction evaluation,” establishing a full-process evaluation and iteration mechanism. The third-party customer satisfaction score reached 99.29 points, ranking among industry leaders. In the residential sector, by creating a “signature service” product system and a “4+N” benchmark model, 16 flagship projects were selected in 2025 to realize service value and enhance brand premium.

It is also worth noting that the industry is accelerating its transformation toward intelligence and technology, demanding higher operational efficiency and service experience. To meet this, China Merchants Property Development continues to empower its business with digital intelligence, such as using AI to improve parking lot management, managing outsourcing processes through online systems, deepening AI applications in customer scenarios, and enabling the headquarters, cities, and projects to automatically generate unified accounts with “T+1” system; launching the “Five-Stage Two-Rate” control measures, deeply integrating with the Hongmeng ecosystem, and improving project management quality.

By 2025, China Merchants Property Development ranks in the TOP 3 among the “Top 500 Chinese Property Service Companies” and for the first time enters the “Top 3 of China’s Top 100 Property Service Companies in 2025,” confirming industry recognition of its overall capability improvement.

The annual report also shows that by 2025, the number of managed projects increased to 2,473, with new annual contracts signed totaling 4.48 billion yuan, including 4.169 billion yuan from third-party contracts, a 13% increase. Compared to 2021, the proportion of third-party new annual contracts rose steadily from nearly 80% to over 90% in 2025, indicating that upgrading comprehensive management and service capabilities directly promotes market expansion and long-term trust from partners.

Residential Market Expansion and Breakthroughs

Value-added Business Defying Market Trends to Strengthen Competitive Edge

Currently, China Merchants Property Development’s market expansion mainly targets residential and non-residential sectors. In 2025, the residential project market signed new annual contracts worth 474 million yuan, a 60% increase. The company also established a “Residential Development Special Team” to focus on enhancing market strength, service capability, and product quality.

However, as the primary property service scenario, competition among companies is no longer limited to basic property management. Value-added services that extend beyond traditional offerings and innovate in scenes are key to winning the market and improving customer satisfaction. China Merchants Property Development continues to regard “community value-added services” as a strategic focus, developing services such as home delivery, space resources, real estate brokerage, and home improvement, creating a diversified integrated service ecosystem.

These service tracks tend to have high stickiness and growth potential. For example, “home delivery” services have expanded to over 50 cities, with a good reputation in housekeeping, appliance cleaning, laundry, and pet services, with high customer satisfaction and repeat purchase rates. The “Zhao Xiao Chong” platform for space resources has provided over 11.57 million efficient charging sessions for new energy vehicle owners by 2025, reducing carbon emissions by 21,000 tons. Community services also generally offer second-hand property brokerage, completing a service loop.

Through strategic collaboration with China Merchants Shekou, the company is also providing bulk high-end renovation services (“Meiju Business”) in some high-potential hub cities, accelerating the expansion of third-party maintenance networks, and integrating “real estate sales + new home delivery + old house renovation” value chains in some projects, as well as developing “property + health care” services. These efforts leverage parent company resources to explore cooperation opportunities and innovative development.

“By 2021, community value-added service revenue accounted for over 10% of total revenue, becoming one of the important income sources for property companies,” according to the China Index Academy. Currently, many property companies are experiencing a decline in value-added service contributions due to sluggish development. Conversely, those maintaining growth in value-added services against the trend are likely to secure larger market expansion and revenue growth.

Data confirms this: by the end of 2025, China Merchants Property Development’s platform value-added services generated 537 million yuan in revenue, with professional value-added services contributing 3.786 billion yuan. These two major value-added businesses accounted for 23.24% of property management income, up from 18.72% in 2024. As value-added service revenue stabilizes, the company’s gross profit margin remains resilient, helping stabilize overall profits and broadening future growth prospects.

Deepening Non-Residential “Segmented Tracks”

Resilience Driving Long-term Growth

In the non-residential sector, China Merchants Property Development continues to maintain a leading position. In 2025, new signed annual contracts in this sector reached 3.695 billion yuan, an 8.8% increase, with notable achievements in specialized segments.

Data shows that in 2025, new signed annual contracts in the aviation sector totaled 191 million yuan, up 85%; in higher education, 232 million yuan, up 25%; and in IFM (Integrated Facility Management), 369 million yuan, up 15%. Projects include China Southern Airlines Xinjiang branch, Renmin University Tongzhou campus, and Beijing Changxin Storage.

In 2025, multi-channel efforts accelerated market expansion. The company’s core client share increased significantly, with new clients such as OPPO, Xiyin, and Sam’s Club. Third-party projects jointly developed with China Merchants Group and China Merchants Shekou signed new annual contracts of 282 million yuan and 336 million yuan, respectively. This reflects the unique resource advantage derived from its background as a central enterprise.

Additionally, in the commercial property sector, by the end of 2025, China Merchants Commercial Management managed 73 commercial projects (including pre-operational projects), covering 3.95 million square meters, including hotels, shopping centers, retail, and office buildings. In 2025, the managed commercial sales increased by 8.4% year-on-year, with a 16.7% increase in foot traffic and an 18% rise in membership to 8.22 million. The overall leasing rate of 468,900 square meters of rentable space reached 93%, a remarkable achievement.

Overall, facing the complex market environment of 2025, China Merchants Property Development has focused on strengthening foundational capabilities, achieving “full bloom” in both residential and non-residential markets, demonstrating strong resilience. Fitch Securities analyst Fang Chengqi pointed out that thanks to a focus on core property management and professional service capabilities, as well as commercial operation management, China Merchants Property Development’s overall revenue growth remains steady. Its revenue growth rate is notably ahead among leading property companies, with profit margins gradually recovering. With both internal growth and external expansion, the company’s performance shows strong resilience, and long-term stable growth is expected.