This report does not constitute a rating action. Sales to track industry: We expect Yuexiu Property's contracted sales to decline by 10%-12% in 2026, in line with the 10%-14% drop we expect for nationwide primary sales. The company's contracted sales were down 37.5% year on year to Chinese renminbi (RMB) 25.7 billion in the first four months of 2026. We anticipate a recovery from May to narrow the gap, driven by increasing project launches and a lower comparison base. Disposals support deleveraging: Cash proceeds of RMB4.46 billion from Yuexiu Property's proposed sale of non-core assets to parent Yuexiu Group will bolster cash flow in 2026 and support stable debt. We forecast an adjusted debt-to-EBITDA ratio of about 10x for 2027-2028,
