Shenwan Hongyuan Group Co., Ltd. issued a research report maintaining a "Buy" rating on BEKE-W (02423), citing the company's continued market share growth in brokerage services and promising expansion potential in home renovation and rental businesses. The firm's industry position remains stable, while its valuation remains attractive compared to smaller peers like 5i5j (26x forward P/E in 2026 consensus estimates).

BEKE's platform advantages are deeply entrenched, having reshaped brokerage infrastructure and locked in agent-property resources with full-process control capabilities. Key highlights from Shenwan Hongyuan's analysis include:

**Q3 2025 Performance Overview** BEKE reported Q3 2025 results largely in line with expectations: - Gross Transaction Value (GTV) remained flat YoY at RMB736.7 billion - Revenue rose 2% YoY to RMB23.05 billion - Adjusted net profit attributable to shareholders declined 28% YoY to RMB1.29 billion - Non-GAAP net margin stood at 5.6%

Breakdown by segment: 1. **Existing Home Transactions**: - GTV grew 5.8% YoY to RMB505.6 billion (Lianjia: 38%, Beilian: 62% share) - Revenue fell 3.6% YoY to RMB6.0 billion - Contribution margin dipped 2.0pp YoY to 39.0%

2. **New Home Sales**: - GTV dropped 13.7% YoY to RMB196.3 billion (Lianjia: 18%, Beilian: 82% share) - Revenue declined 14.1% YoY to RMB6.64 billion - Contribution margin was 24.1% (-0.7pp YoY)

**Operational Metrics** - Active stores: 59,000 (+26% YoY) - Active agents: 472,000 (+11.4% YoY)

**Emerging Businesses Show Strength** - **Home Renovation**: Revenue grew 2.1% YoY to RMB4.3 billion with contribution margin improving 0.8pp to 32.0% due to operational efficiencies. - **Rental Services**: Revenue surged 45.3% YoY to RMB5.73 billion, with contribution margin jumping 4.3pp to 8.7% driven by increased managed listings. Both segments achieved profitability at city level before corporate cost allocations.

**Revised Forecasts & Valuation** Shenwan Hongyuan lowered 2025-27 net profit estimates to RMB3.6/5.4/6.4 billion (from RMB5.1/6.3/7.5 billion) on softer GTV trends and margin pressure. Current share price implies 2025/26 P/E of 38x/25x (25x/19x on Non-GAAP basis).

**Risks**: Property market downturn and key personnel changes.