Dear investors and friends from the press, a very good morning. Welcome to attend Vanke 2023 annual results announcement. We have an online streaming. Feel free to enter the streaming room through our website and also the Quanjing Network. Before we get started, please allow me to introduce the management. We have Chair of the Board Yu Liang, President Zhu Jius heng, Co-President and Chief Partner of Development and Operation Headquarters Zhang Hai, Co-President, Chief Partner of Property Service Business Group Zhu Baoquan, Executive VP and Financial Principal Han Huihua, Executive VP and COO Liu Xiao, and Company Secretary Zhu Xu. There are two parts in today's session. First of all, we'll have our president to report to you our 2023 results, and then there will be a Q&A session. Now, I'd like to ask President Zhu to update you the 2023 results. Let me get started. There are four bullet points: the results key points, financial review, business review, and priorities for 2024. Results key points: please refer to page four of the slide, including seven categories. We have maintained very stable financial performances. We have a 3.61% of cost of newly acquired onshore financing. Average debt maturity is 5.14 years, increased by 0.35 years from the previous year. The debt-to-asset ratio after deduction of advance receipt is 65.5%, down 2.1%. Development business sales revenue reached RMB 376.12 billion. The sales volume ranked number two in the industry, with 289,000 units delivered with high quality. The operating service business, the aggregate revenue is RMB 55.81 billion, up by 8.9%. The public offering of REITs and of property service, all of these have made very steady progress. Specifically for property management, the number of Wanwu Town increased to 621, overall efficiency improved by 4.5% for renovated Wanwu Town. For rental housing, the EBITDA improved by 32.3%. We have also achieved the overall profitability under cost approach. Logistics and warehousing NOI is RMB 2.19 billion, up by 10.6% year-on-year. The retail property development and operations, the SCPG occupancy rate is 94.8%, up 1.6%. Tier 1 and Tier 2 accounts for over 90% of total floor area. Now, financial review. Please refer to page six of the slide. We have RMB 12.16 billion of net profit attributable to shareholders, down by 46.4%. Primary reasons being a decline of reduced settlement size and gross margin of development business, as well as the impairment provisions for certain development projects. Due to the increasing proportion of land costs in selling prices in recent years, the overall GP margin before tax was 15.2%, representing a 4.3% year-on-year decrease. The company adopts the cost method for accounting of operating assets. After adding back depreciation and amortization, the GP margin stood at 16.3%, a decline of 4.3%. Based on the prudent market strategy, we've made impairment provisions of CNY 4.85 billion for inventory projects with impairment risks, which reduced net profit attributable to shareholders by CNY 3.55 billion. Revenue and GP margin: we've achieved CNY 465.74 billion of total operating revenue, down by 7.6%. Among the business segments, revenue and GP margin from the development business declined, while property management services and operational business revenues were CNY 29.4 billion and CNY 13.4 billion, grown by 14.2% and 12.9%, respectively. The GP margin for these two segments increased by 0.5% and 5.2%. The total revenue of the operation service was CNY 55.8 billion, increased by 8.9% year-on-year. Now, revenue and the NOI from operational business: we have in total CNY 22.4 billion for non-consolidated operating business revenue, up by 8.4%. The NOI is RMB 11.1 billion, up by 5.4% year-on-year. Now we come to page nine, robust financial position. Net operating cash flow stayed positive for 15 years in a row. Net operating cash flow for the whole year stood at RMB 3.91 billion, an increase of RMB 3.67 billion from the third quarter, up RMB 1.16 billion from 2022. The cash on hand is RMB 99.81 billion, sufficient to cover interest-bearing liabilities maturing within one year. The short-term debt ratio stood at 1.6%. The debt ratio continued to decline for five years in a row, and the debt ratio after deduction of advance receipt fell to 65.5% from the peak of 76% in 2008. The net gearing ratio stood at 54.7%, maintaining a healthy level. Now we turn to page 10. We have also received bigger support from financial institutions. We've been enhancing interaction and communication with financial institutions, proactively interacting with them and investors, and dynamically adjusting financial strategies to secure extensive support. We have a newly acquired financing of RMB 89.7 billion, including RMB 76.6 billion for onshore and RMB 13.1 billion for offshore. We've also closely followed national real estate financial support policy and stepped up efforts for financing products such as operating property loans, rental housing, and shantytown renewal projects. We have increased operating property loans of RMB 10.89 billion since the beginning of 2024. We've also been proactively transformed to new financing models since the implementation of urban real estate financing coordination mechanism. By the end of March 2024, the group has applied for 42 whitelisted projects in 22 cities. Now we turn to page 11. We have an improved debt structure. At the end of 2023, the total interest-bearing debt reached RMB 320.05 billion. Debt structure further improved, with offshore debt down to less than 20% against the increase of the Federal Reserve rate. The percentage of short-term debt to total debt reduced to 19.5%, debt maturity increasing from 4.79 years by the end of 2022 to 5.14 years, which has further improved our ability against risks. Now, business review: development business, we've ranked number two in industry with a leading collection ratio. Our sales volume reached RMB 376.12 billion, down by 9.8% year-on-year. Among 35 cities nationwide, we ranked among top three. Our contract amount of areas sold but not booked has also reached a very high level, reaching RMB 360.44 billion, while the sales collection and sales volume is 101%. Here you see on the slide, this is the Shanghai Ideal Place, Xi'an East Shore, Zhongxin Town at Zhongshan Bay, and Snow Mountain Vanke Town, Jinan. These are the highlight projects in 2023. For Shanghai Ideal Place, we have reached RMB 12 billion sales volume, ranking number seven, in total 2,103 units, altogether 238,000 sqm, number one for sales of units in Shanghai. For Xi'an East Shore, ranked number six for sold area in industry, while for Zhongxin Town, ranked number nine, reaching 299,000 sqm, while for Snow Mountain Vanke Town, stood at number 11 with 290,000 sqm sold area. We have also achieved fruitful product line development with stable and quality new completions. The Xi Series is an integrated residential upgrade product. In 2023, in Shanghai, Hangzhou, and Chengdu, we have finished the initial implementation and also completed product iteration in Ningbo, Suzhou, and Hefei, and mass implementation for 16 projects in seven cities. It took an average cycle of 114 days from land acquisition to opening, and 10 out of the 12 new projects realized a sales volume of RMB 12.2 billion within the year. Implemented the first future city project in Jiading District, Shanghai, including the Ideal Place, winning customer recognition. Under the vitality, low carbon, and intelligent core scenarios, 10 projects received major awards of China's construction industry. Among them, Chengdu Tianfu International Conference Center received the Luban Award, and also for Jinan, for the projects in Shenyang and also the project in Dalian, they have also received respective prizes. Here on this slide, we have demoed the Shanghai Longhua Hui, as well as the Suzhou Yuhu Lanshi, as well as the Tianfu International Conference Center Luban Award, as well as the Shenyang Feicui Guanlan. Now we come to page 15 about the delivery. We have improved post-delivery customer experience and increased occupancy rate for large residential projects. We've achieved 289,000 units delivery of residential projects, while for commercial properties and offices throughout the year, we have realized ownership certificate delivery upon property delivery for 191 batches. We have also 371 projects with 160,000 customer participations for our open worksite, continuously improving the living experience. We have also improved amenities for 35 large residential projects and also increased 30% of occupancy rate. For instance, we have 1,677 households moved into the Changchun Sunflower Town, and 1,064 households moved to the Jiaxing Ideal Land, and also 1,003 households moved into the Wuhan Ideal City. Our selling rate is also improving steadily with an improving resource structure. We have achieved a desirable sales rate for newly opened projects, opened 50 projects, which contributed RMB 70.6 billion. The first-day sales rate is 67%. Among them, 13 projects achieved the first-day sales rate of 80%, including the six projects in Hefei, Dongguan, Hangzhou, and Shanghai. They were sold out on the first day. We have also increased the sales rate of inventory through refined management resources. The group has sold RMB nearly 200 billion of inventory from the beginning of the year, including RMB 28 billion for commercial and office properties and RMB 9.6 billion for parking spaces, with a sales rate above 60%, up 3% from 2022. We have also improved the resource structure by activating resources. Where policy permitted, the group converted resources, unlocked, and optimized within the year into sales worth RMB 9.02 billion. We have also, in total, completed 19,000 live streaming events. For our Changsha subsidiary, it has generated 25% of sales performance through digital marketing. While for the Home Sharing, we have made 920,000 customer clues, up 39% year-on-year, contributing 14% of total sales. Here, we have listed the Changchun Jade Riverside project as an example. We have sold 166 completed units from the beginning of the year with a resource conversion rate of 98%. While for the Lanzhou Light of Times, we have implemented the existing property archive card lighting toolkit and traffic route optimization, resulting in a 413% sales improvement. While for the Guiyang subsidiary, we have achieved the sales of 6,626 parking spaces, hitting a new record in history. Now we turn to page 17. For high-quality, precision investment, we have achieved 88% of investment fulfillment rate. We focus on the regions where it's real demand. We acquired 43 new projects in Beijing, Shanghai, Hangzhou, and Chengdu, accounting for nearly 40% of new merchandise value. The total land price is RMB 84.91 billion, while the average land price of new projects is RMB 13,899 per sqm. With 98% proportion of investments in Tier 1 and Tier 2 cities, we have also shortened the cycle for land acquisition to 4.4 months. Among the 43 newly acquired projects, 33 have opened for sale. We have also achieved 19.8% of GP margin with a sales volume of RMB 51 billion. The investment fulfillment rate is 88%. We have also achieved 17 million sq m newly started and restarted construction area, accounting for 102% of the plan for the whole year. We have also completed the construction area of 31 million sq m, fulfilling 97.1% of the plan. Now, on the right-hand side of the slide, you can see one of the cases, Beijing, Dongba. We have achieved a moderate progress. We have acquired it in August 2023 and opened for sale on November 19, 2023, with a purchase office worth RMB 1.02 billion at a unit price of RMB 58,000 per square meter and ranking number one. We continue to improve our development efficiency to foster the leading advantage of completed house project sales. In the end, actually leveraging our own product design engineering and process optimization, we continue to improve our development efficiency. On the left-hand corner, I show you a few typical cases of two development business models. The first one is Hainan Vanke Jinse Licheng affordable housing project. The second one is Hainan Vanke Gongyuan Li affordable housing project. Both projects took 12.3 months and 40.5 months for the completion. And actually, for Jinse Licheng, actually the total sales volume stood at RMB 1.87 billion with a project IRR of 38%. While for the Hainan Gongyuan Li affordable housing project, actually the total sales reached RMB 4.15 billion. The project IRR is already 44%. We also continue to strengthen the EPC and the construction management business. We provide services to government agencies, financial institutions, high-tech enterprises, including the schools' affordable housing industrial facilities, urban revitalization healthcare facilities, and commercial residential development. In 2023, the EPC and the construction management business achieved RMB 12.31 billion. We also garnered 132 awards accorded at various levels, including the International Safety Award, China Construction Decoration Award, China Steel Structure Gold Award, Provincial and Municipal High-Quality Structure Award. Altogether, we have 341 accumulative projects under construction and management. Accumulated GFA under management is around 39 million sqm. The current project under management is around 89. We show you a few examples, including Shenzhen Nantou Ancient City, Shenzhen Nanshan Smart City, Shenzhen Bay Super Headquarters Base B Tower, and Wuxi Zhouxin Old Street project. Coming next, let me talk about Wanwu. Wanwu's strategy continues to foster the robust core business growth. Wanwu revenue stood at RMB 33.42 billion, growth by 10.2%. Community space residential consumption service stood at RMB 80.93 billion of the revenue. The share of the revenue was 56.6%. Commercial and urban space integrated service, the revenue was RMB 11.7 billion. AIoT and BPaaS solution, the revenue was RMB 2.79 billion, and growth by 16.9%, attribute to 8.4% of the total revenue. And you can see now, residential property service projects altogether more than 3,810. And we also have contracted projects of the residential projects of more than 4,658. The accumulated investment of Wanwu's strategy is more than RMB 300 million. Accumulated renovation of the residential project stood at 1,124. Gross margin of the Wanwu Town strategy after renovations being improved by 4.5 percentage points. You can also see that we continue to dive into the existing customer. Commercial and enterprise service focus on industrial customers for stable growth. The saturated revenue is up to 51.7% on a worldwide basis. In the year of 2023, altogether for the commercial enterprises service, we newly serviced projects accounted for 412, newly contractual projects 398, accumulated service projects 2,241, accumulated contractual projects 2,531. We continue to diversify the project service. Altogether, the contractual value reached RMB 543 million, growth by 107.5% on a worldwide basis, including Hubei Radio and Television Media Center, Central Park of Huangpu, and Zhongshan Future Gate. Wanwu continues to harness technology to improve its service quality. The technology product has been substantial. We leverage technology to continue to improve our professional service for residential, commercial, and urban domains. The Pineapple No. 1 Property Self-Service Machine recorded 3.2 million uses, where Black Cat Access Equipment System registered 4.12 billion uses. Additionally, residential projects incorporating technology products achieved a four-star customer satisfaction rate of more than 80%. You can also see that technology revenue stood at RMB 2.79 billion, up by 16.9% on a worldwide basis. The share of technology in GP margin has already reached 16.9%. Coming next, let me talk about residential housing projects. We still have the industry-leading scale and operational efficiency. We have the largest portfolio of the centralized apartment in China, with 233,000 rooms under management, 180,000 newly unveiled rooms, 31-city coverage, and 147 subsidized housing projects. In the year of 2023, the occupancy rate is 95.8%, up by 0.2 percentage points. Marketing expense has been down by 0.2 percentage points. GP margin of the front office was improved by 0.9 percentage points. EBITDA was RMB 665 million, up by 32.3%. Customer acquisition costs continue to go down. Percentage of open channel was 85%. We continue to enhance tenants' living experience through a reliable and attentive living service approach. Accumulatively, we served more than 800,000 customers. Customer satisfaction is 94.8%. We also organized more than 1,990 community events. For rental housing, we further diversify the product portfolio to shape a multi-brand growth strategy. We will be able to continue to provide family-oriented apartments altogether for 36 projects across 15 cities. We also provide high-quality dormitories for blue-collar workers. We manage more than 10,000 beds in 10 cities. We will also be able to manage nine major rental housing projects. More projects will be available very soon. In these months, I have already shown you that in Xiamen, Boyu Yingy ue Flagship Stores, and Xiamen, Guanyin Shan Flagship Stores, and Suzhou, Guanyin Shan Talent Apartment, these are the three cases we'd like to share to you. We continue to serve the real economy by leveraging the collaboration and support for the corporate clients. We also continue to work with KA Management Account, strategic cultivation of the corporate clients. You can see proportion of the customer account has been improved from 90%-23%, contributing to a more stable customer structure for the business. We worked with SOEs and other investors for the subsidized housing to facilitate the transition from the non-residential to the rental properties. You can see in 2023, the proportion of Vanke assets in newly acquired projects increased to 75%, marking a 23% worldwide growth. We have already served more than 5,000 enterprise customers. Share of the corporate clients was 23%. We were working with many very famous corporate tenants in China. Coming next, let me talk about logistics and warehousing. We have a very stable cold chain business continuing to lead the sustained and steady growth in operating revenue. We now operate and manage 162 projects in 47 cities, with a total leasable GFA of 12.1 million sqm. The leasable GFA of our existing projects and the newly unveiled projects was 10 million sqm and 440,000 sqm, respectively. And you can see, actually, the occupancy rate of the high-standard warehouse during the stable period was 88%. Utilization rate of the cold chain during the report period was 77%. And you can also see the revenue from our cold chain business reached RMB 1.88 billion, up by 33.9%. Cold chain parks covering 2.03 million sqm led the industry in terms of the management scale. You can also see that we successfully worked with Shenzhen International Holdings to have the first light assets projects being landed. We also continue to serve the customer as our core competency. Ultimately, we're going to join hands with Supermarkets and Hypermarkets and the fruit stores and continue to improve our service quality to improve the customer loyalty. Ultimately, we will be able to provide the B2B and 2C full value chain management, truly differentiating ourselves by providing the catering service to the customer. We also have lean management and continue to help the customers reduce their logistics cost. While at the same time, we also have a VX Logistics Xinchang campus, which was being located in Shanghai, that is responsible for providing the storage and distribution service. We actually provide the 24/7 temperature monitoring and continue to handle any of the needs. So you can see that as Online Fulfillment Center for Sam's Club Shanghai and Walmart Fresh Food Distribution Hub, the park offers a full range of the business functionalities, including home delivery, cloud warehouse delivery, and product production and processing. Our lean management has been recognized by the top-tier customers. The park processed more than 600,000 orders during peak season. Coming next, let's talk about the real property development and operational business. We're going to focus on the key areas for asset-heavy and asset-light co-development. The total revenue, including the non-consolidated items, reached RMB 9.11 billion, growth by 4.6% on a worldwide basis. SCPG contributed RMB 5.7 billion. Occupancy rate of SCPG stood at 94.8%, up by 1.6 percentage points on a worldwide basis. Altogether, we have 11.58 million sqm as accumulated opening areas, excluding asset-light outfit management projects. Yangtze River Delta and Pearl River Delta accounted for more than 52% of the total scale. 90% of the accumulated opening areas are in the Tier 1 and Tier 2 cities, with 24% of the area concentrated in four major Tier 1 cities. For asset-heavy operations, we build the flagship projects to expand brand influence. While for asset-light operations, we prioritize key cities and partnerships and stable cash flow growth with leading domestic markets in terms of the development scale. We show you four successful samples, including Gala at Shenzhen Longgang Vanke Plaza and Shanghai Nanxiang Incity Mega. We also have Shanghai Caohejing Incity and Jinjiang Inc ity. Those are all asset-heavy and asset-light excellent cases. We also keep an eye on the property development and operational business, focusing on commercial development and operation to cultivate top-tier strengths. We have already covered more than 200 projects under management with 11 million sqm of commercial space under management, covering 55 cities and serving more than 800 million people throughout the year. We not only have an Incity Mega focusing on extensive authorities and experience. We also have Vanke Plaza Incity providing family leisure activities, but also Vanke Li and Inlane enriching community well-being. We continue to dive into local culture and consumer demands, providing customized design and unique commercial space and content. We're also cooperating with 12,000 brands, leveraging technology to continue to empower our membership team. Altogether, we have 34.32 million digital members by the end of 2023. On the right side, I show you the Fuzhou Yantai Mountain projects, which was being put into operation in September of 2022. The total traffic is already more than 11 million, becoming the must-go place in Fuzhou City. We're real property development and operation with more newly opened projects being available and receiving positive feedback. In 2023, we launched 50 commercial projects and got very positive responses from the consumers. On the left side, we show you Chongqing Incity, Shanghai Longhua Hui. Those are the two projects being newly unveiled in 2023. By leveraging lean management, we continue to improve management efficiency. On the right side, we show you Urumqi, Tianshan Vanke Plaza, and Chengdu Tianfu Vanke Plaza. Both projects see very good operational enhancements in 2023. Coming next, let me talk about office building. We focus on high-quality office assets with robust operations. We prioritize the operation and efficiency. We serve customers, many located in Beijing, Shanghai, Guangzhou, Shenzhen, Chengdu, Hangzhou. The majority of the clients are in modern service, financial, and technology sectors. We altogether have 609 corporate tenants with a total leased area of more than 1,000 sqm, accounting for 65% of the total GFA. Those who remain in contractual terms exceeding 24 months' occupancy were more than 61% of the total GFA. So you can see that altogether, we have 90 projects in operation, NOI was 68%. In the down part, we show you Shanghai Hongqiao Vanke Center, Guangzhou Siyou Vanke Center, Chengdu Co-Innovation and Cooperation Center, and Hangzhou Huanglong Vanke Center. These are the four office building projects we have. Well, coming next, let's talk about hotels and resorts. Altogether, we have 32 hotels across key cities in Beijing, Shenzhen, Chengdu, Guangzhou. Also, we have a project in Yangshuo and Lijiang. We continue to have Zhanyun, the proprietary brand to cater the customer needs, and Youxiong, embodying vibrant urban culture. And we unveiled two Youxiong hotels, which, seeing Chaozhou Ancient City and Suzhou Changyuan during 2023-2024 snow season, operated four ski resorts, including the lake resorts in Jilin and altogether 68 slopes. We accommodated 730,000 visitors. Songhua Lake Resort has been honored as the World Ski Awards' China's Best Ski Resort for seven consecutive years. In the bottom part, we show you our three successful cases, including Youxiong, Suzhou Changyuan, and Dongguan, Banyan Tree, and Songhua Lake Resort in Jilin. Our operational business has implemented a closed-loop business model. Please refer to page 34. We've achieved breakthroughs in public REITs and consumption REITs. Public inquiry has been completed about RMB 3.96 billion value. We have also made the application for VX warehouse and logistics REITs. It's in due progress, which would be very helpful for building a closed-loop business model for operational business so as to achieve a high utilization rate of our capital. In addition, we have also established a CCB Vanke Housing Leasing Fund in collaboration with CCB, totaling RMB 10 billion. We have also signed five projects worth a total of RMB 2.8 billion. In February 2024, we have also transferred the remaining 50% of interest in Shanghai Qibao Vanke Plaza to Link REIT for a transaction consideration of RMB 2.38 billion. Now, as you can see from this slide, the Hangzhou Xixi Incity is valued at over RMB 316 million. In addition, we've also been fostering strategic partnerships and improving the quality for these consumption-related REITs projects. We've also been showcasing a versatile expertise across various industry scenarios and securing sustainable business growth through comprehensive capabilities. Shenzhen SASAC and major shareholders offered steadfast support to Vanke. The SASAC's positive stance played a pivotal role in bolstering market confidence. While for Shenzhen Metro, one of our major shareholders, it actively engaged in commercial consumer rate placements to support Vanke with concrete actions. We've also strengthened partnerships with industry leaders to offer a wide range of B2B services, in particular the top-notch players in the sector, including residential group purchasing, property management, staff apartment leasing, and commissioned asset construction operation, among other services. Right now, we have already achieved strategic alliances with Huawei, CITIC, Tencent, ZTE, GIC, SIHC, and Shenzhen SEZ Construction Group. These enable us to collectively expand our business offerings. Furthermore, we provide robust support to our partners in major transactions, facilitating wholesale leasing of commercial properties and asset management. In addition, we've also been deepening our cooperation with Huawei. In cities like Shenzhen and Dongguan, we've built numerous projects. We have also signed an Ark-1 spatial intelligence open laboratory, jointly established with these players. Now, on page 36, this is about our ESG performance. We've been actively pursuing green and low-carbon practices, maintaining sustainable operations. We have also received a lot of industry-leading agencies' recognition for our ESG performance. As you can see from this slide, different raters have given very leading performances. We have also achieved a total tax contribution of RMB 53.37 billion. The accumulated GFA of green buildings is over 328 million sqm, and about 49% of these new projects have introduced a renewable energy design. We have also an additional six LEED Platinum or Gold certificates. The Dongguan campus for VX Tianjin has received a LEED Platinum. We have also increased the coverage of photovoltaic panels. While in promoting green building, we have an accumulative of over 230 million sqm of industrial buildings. For new projects, it accounts for over 90%. While for the rental property, 100% of these leasing contracts were included in a green lease initiative. So our ESG performance has been widely recognized by third-party evaluators. Now, we come to page 37 about the 2024 priorities. Firstly, there are four priorities. The first is about upholding the safety bottom line to sustain the outperformance of our development business against the market, securing a positive cash flow. Secondly, to strengthen bulk trading and equity transactions, collecting over RMB 30 billion to enforce our safety caution. In addition, we would persistently reduce leverage and transform our financing models. In the coming two years, we would reduce the interest-bearing debt by RMB 100 billion, actively seeking out financing instruments such as operating property loans to fully integrate into the urban real estate financing coordination mechanism to drive the transformation of our financing model. Thirdly, maintaining our customer reputation by delivering excellent products and services, ensuring high-quality project delivery to fortify our reputation among customers and in the market through excellent products and services, to further enhance our advantage through synergetic expertise in products, facilities, and property services. And fourthly, reducing costs through lean and efficient operation to streamline our organization for efficiency, retaining a stable core team for business growth, and also to take cost-saving actions and lower management costs. Recently, many friends pay close attention to our debt repayment and operating soundness. With the above presentation, I believe you have now an overall picture. In a word, we have made very active adjustments of our operating strategy and kept the safety bottom line, even though for some of the short-term indicators, including the shortened debt ratio, were not so good. But these are just momentary performance. We have also made very active adjustments in our strategy and also been supported greatly by state-owned players, including Shenzhen Metro and also SASAC. We believe that even though the industry is facing tremendous pressure, there's a broad room for growth in the mid to long range after more market actions that we will undertake. In a previous presentation, we've talked a lot about how we enhance our business capabilities. I believe that after this year's further improvement and adjustment, we are going to consolidate our incumbent advantage in our daily operation. The company is going to embrace the challenges in the future with a more resilient mentality. Thank you. That's all for my part. Thank you so much, Mr. Zhu. Now, we'll start the Q&A session. I'd like to ask the meeting secretary to receive questions. Good morning, everyone. Ladies and gentlemen, we'll now begin the question. If you would like to ask a question, please press star and then one on your telephone keypad and wait for your name to be announced. Thank you. Please press star and then one on your keypad. Now, we have 32 people waiting for the question. Each person could only raise one question. Now, the first question is from GF Securities, Guo Zhen. I'd like to thank the management team for the opportunity to ask questions. Now, we are still facing an adversarial environment, and there are also a lot of negative comments in the market. But I believe that the company could overcome these challenges and create new glory. I have three questions. Firstly, recently, we heard something about the financing, about the rating. So now, for some third-party raters, they have downgraded the company's rating. So how does that affect our financing opportunities? And secondly, we have encountered some setbacks. There are some rumors about the financial setbacks, about the banks now withdrawing the loans. So what is our current collaboration with financial institutions? Is it smooth? And also, there's a rumor that 12 banks are preparing loans for the Vanke. So from the company's perspective, the company is also making a lot of preparations and guarantees. What's your take on these rumors? And thank you. Thank you Mr. Guo Zhen for your question. Thank you for your best wishes to Vanke. Your question is mainly about the rating and about the financing. I'd like to ask the chairman to ask the management to respond. Okay? This question, Mr. Zhu, please respond to it. Okay? First of all, thank you for your questions. These accounts or these rumors, I think these have reflected the market concern and also care about the company, as well as the high expectations for the company. Indeed, the company, we have encountered some challenges and pressure, and we've been constantly reflecting and leveraging our past experiences to deal with the situation. I believe that the fundamental aspect of the company remains unchanged. As long as it has the operating capabilities, all challenges could be resolved. As to the market concern, indeed, we seldom publicly respond to these concerns. But I'd like to use a quote that, "Black and white, they cannot be reversed to one another just by talking." You also talk about the rating adjustment and also the cooperation with financial institutions, as well as the borrowings from the banks, and also about the loan methods. I will try to respond to these questions. Indeed, for the rating, a lot of agencies, they have down-tuned our rating. However, the company's fundamental capabilities have not been changed. But of course, the down-tuning of the rating would apparently produce some ripples. But these are not fundamental impact, or the impact is very limited. That's about the rating. Now, as to the cooperation with financial institutions, I'll start with banks. In the long run, Vanke has always been maintaining a strategic and long-term collaboration with banks. Our whitelist, we have eight short-listed banks and over 10 long-listed cooperating banks. So we have 16 banks working on a very regular basis. They've been very supportive to Vanke and grow together, and also to hedge against the risk. While against the downtrending of the industry with less sales, apparently, the banks served as an ally with developers. Among the 26 banks, I think they have been very supportive to our operation. They have also given us very good advice and also reminded us about the potential risks. We have all perceived the potential risks from the market. They've been giving us very good advice, for example, for developers like us, how to effectively strike a balance at our cash flow. The banks and the bankers, they've given us very sound advice. And we humbly listen to their opinions, and we jointly consult together to come up with a better responsive strategy to the market dynamics. They've been very forgiving and lenient. In the past, we were adopting a credit-based system to get the borrowings. But now, we are shifting towards a project-based or a mortgage-based financing model. This swift overnight is somewhat difficult, but the banks that we're working with have given us a one, two, three years of transitional period so that step by step, we might be able to switch to this new financing model. And also, in our past interaction with the banks, they have three concerns. Firstly, where the money will flow to, and where are the assets and projects. Thirdly, whether the company has enough cash flow, or do we have enough value of the goods, or do we have enough cash flow to support the operations. Well, I think the team of Vanke will still be quite frank and be able to respond to the three concerns of the banking industry as to make sure we have a very smooth financing channel with strong support from the banks, especially starting from the year of 2023. We actually got the bank financing close to CNY 89.7 billion, close to CNY 90 billion. You can already see how the banks supported us as we are working with banks, as we have to deal with multiple banks. The preference and also the strategy of each bank differs. There are some commonalities. Sometimes, we sit down together to come up with the solutions. And we also heard some of the banks proposing the collateral loans. We're just taking the ideas and the suggestions and advice with a humble heart and also continue to discuss with the banks. So regarding our cooperation with banks, overall speaking, I think our cooperation with banks is pretty stable and sustainable. While as we're working with the insurance company, indeed, we're working with many large insurance companies starting from the year of 2040, and we started to provide the operational service business. So that's the reason Vanke has already made many explorations in different diversified business lines. And we also have a very rich portfolio of the assets. So that's the reason we become the natural trading party with the insurance company. Where you can see that for the insurance capital, they are here to support us and continue to keep an eye on our operating business. Majority of our cooperation with those insurance capitals were more than 10 years. Generally speaking, for the term, it's always 5+1 or plus earn. Sometimes, the term of the cooperation actually depends on Vanke or on the mutual party. When the end of the term is coming, and we're going to sit down with the insurance company to see whether they're going to exercise their rights or not. But I also would like to thank the insurance company. Thanks for China Life. Thanks for Ping An. Thanks for Xinhua. Thanks for those major insurance companies for supporting Vanke with a patient heart, with long-term support to Vanke, making sure that Vanke is more resilient and continue to be more calm in operating our operational business. They come and support us, making us more confident in continuing our business growth. With greater support from the banks, we will be able to acquire more high-quality projects, continue to improve the quality of our assets, make us more confident in navigating the water in the market. Well, there are also some other questions regarding Vanke's countermeasures. All in all, I think for Vanke, we're going to still stick to a multi-channel financing strategy. We're going to work with financial institutions, continue to find the common ground, and continue to benefit each other, especially when the property market is being greatly challenged. I would like to thank for the support from the financial institution, from the banking industry, and also from the insurance company. That's all for my response. Thank you. Thank you. Thanks for Mr. Zhou. And thanks for Mr. Guo from GF Securities. Let's welcome the next question, please. Ladies and gentlemen, coming next, let's welcome Wu Xuying from 21st Century Business Herald to raise a question. Ladies and gentlemen, I come from 21st Century Business Herald. I have a question. For the management team, how are you going to comment on the overall development of the property market in 2024? Do you still believe the market is going to have a further downturn when the market is going to respond? We also see from the government, and there's a new attitude toward the property market, also loosening policies being gradually released by different cities and the province. Thank you very much. Your question is regarding the overall trend of the property market, whether they're going to be further downturned when the market is going to respond, and some of the policies, right? Thank you very much. Let me help to take the question on Mr. Zhu. You ask about Vanke's overall judgment of the market trend and what would be the effect from the government policy. Well, regarding the future prospects of the property market, we remain unchanged. We still keep the statements we made before. Even if the market won't be able to go back to the high level it used to be, but still, I think the market is still going to have a very good growth. So starting from the overall trend of the property market, I think we have to be dynamic, and we also need to take a look at the demand of the housing needs in the market. I have two points to share with you. First of all, the property market in China has already been shifted from whether we have the demand or not to see whether we have good demand or not. You can say, actually, the living area per capita means that people still continue to achieve better life quality. So the living area per capita won't remain unchanged. You know that the living area per capita in China is still lagging behind those in Europe and in the United States because in China, the living area per capita is being based upon the construction area. We still need to consider the further improvement in this regard. While at the same time, in China, around 63% of the residential buildings are not equipped with elevators. In China, with such an aging population, elevators would be the fundamentals for any residential projects. So no matter from the living area capacity per capita or from the amenities and facilities of the residential project, still, huge improvement is there, and the demand is still there. Now, on the second point, urbanization in China has not yet been stopped. In 2023, and actually, the urbanization rate in China is 66%. Especially, we need to keep an eye on the net inflow of the urban population, 11.96 million, which is very close to the same level of 2021. So in China, urbanization is still keeping its momentum. So that's the reason, from the two reasons I mentioned above, I do believe the residential construction demand is still going to be at around 1 billion sqm. This is actually what I mean as a central value. I can confirm this number from my own perspective. But in the past one year, the newly constructed residential GFA is only less than 700 million, which was down 59% compared with 2020. So indeed, the market is being undersupplied. I think we won't be able to go back to the traditional 1.8 billion sqm residential constructions many years ago, but we'll still be able to maintain this number at around 1 billion sqm. So I think in the near future, what we're going to do is that we remain our statement and maintain our judgment of the market unchanged. Responding to a second question regarding the government policy, yes, indeed, in recent months, we do see the policy from higher-tier cities, including Beijing, Shanghai, and Guangzhou, those policies being loosened. And the government also started to move the cap regarding the qualifications of the consumer. That'll probably be the most aggressive policy changes starting from 2011 when the purchasing limit is being capped. So you know that with the interest rates being further reduced, actually, the mortgage rate may hit the lowest level in the past one decade. I do believe the market is going to be restored gradually, and the policy effects are going to be released gradually for sure. Where on the other side, there's a very important aspect of the policy many people not clearly notice. That are the Three Major Projects. The Three Major Projects are going to be the key driver for economic recovery and property development. Last year, the central government proposed the Three Major Projects that are going to further improve the new development model of the property market and the economic recovery, including the renovation of the urban village, the building of affordable housing, and also the assessment. I do believe regarding affordable housing and the urban village retrofit or renovation, Vanke has always been a very active player. Starting from the past to now, we proactively joined many urban village renovation and affordable housing projects. Regard to the crediting or the rating, we also continue to improve our performance. For Vanke, we do have our great advantage regarding construction management and the small apartment construction. So Vanke is going to leverage its expertise to support the Three Major Projects proposed by the central government. During the Two Sessions of this year, the Minister of Housing and Urban-Rural Development has already mentioned in the near future, the Chinese property developers are going to compete over high-quality service, high technology, and high-quality development. Which developer can provide good product and solution to the market, to the mass population, who can take the opportunity for business transformation, can win the market, can have the opportunity for further development, can embrace a brighter future? I fully agree with what has been mentioned by the minister. As long as we provide good project and service, Vanke is going to embrace a brighter future for future development. Thank you very much. Thanks for Ms. Wu from 21st Century Business Herald. Coming next, let's welcome the next question, please. Now, let's welcome Mr. Zhang from Morgan Stanley to raise the next question. Ladies and gentlemen, I'm Stephen from Morgan Stanley. I still have a question regarding the financing of the company. So is it possible for the management team to briefly introduce the liabilities that are due in this year, including the onshore and offshore market, deducting the pre-sales regulatory funds and also the co-managed funds? How much do you have left on your balance sheet or your account? And we also started to see that altogether, the sales of the newly constructed projects have been going down a lot. As the contracted sales continue to go down, how can you make sufficient cash flow to support your operations? And we also noticed that the company proposed downsizing the debt by another RMB 100 billion. Where does the money come from? Thank you very much. Thanks for the question from Morgan Stanley. You'd like to know the liability structure or the debt structure for the onshore and offshore market. Onshore and offshore market, you also would like to know that usable cash we have deducting the pre-sales regulatory funds and the co-managed funds. And you also would like to know whether we have any financing gap in the near future. So let me ask Mr. Zhu to respond to the question, please. Thank you. Thanks for the question from Morgan Stanley. As been mentioned in the presentation, you know that cash on hand is around RMB 99.8 billion. Actually, our liability is around RMB 62.4 billion. The cash on hand can cover 1.6x of the interest borrowing liabilities due within one year. So you ask us whether we have enough funds deducting the pre-sale regulatory funds. Objectively speaking, yes, we do have the pressure because many parts of our funds are still within the pre-sale regulatory funds account. In Q2 of this year, we have another RMB 5.6 billion in due. So we're going to have different measures and scheduling the payment of the funds with the maturity term. For sure, we also have the new financing channels and the ways of the financing. So overall speaking, we have a normal financing practice now. So objectively speaking, we do have the pressure, but we do believe we will be able to ride through the difficulties successfully. In order to better respond to your question, let me also report to you regarding some of the challenges that have been met a few weeks ago, especially the challenges related to financing. There are three points I'm going to report to you. First of all, for the property development business, we do see the imbalance for the sales and the investment. We see that contracted sales of the development business continue to go down, especially compared with 2022. We do see a huge drop on a year-by-year basis. Where at the same time, in 2023, for construction expenses, it still became at a high level. And we actually delivered more than 298,000 units of the projects. So we have less contracted sales from the development business, but still, we pay for the engineering construction. This indeed actually led to a difference. The second challenge is a change of the financing model. I have already shared with you in the past, we have the headquarters corporation, but now we have the project-specific corporation. In the past, around 90% of our financing is being based upon credit. Around 80% of the financing is being done by our financing team sitting at the headquarters. They were doing a good job. But now, as financing is being more project-specific, the financing is going to be provided to each of the projects. It takes time for Vanke to be adaptive. In the past, the HQ-to-HQ cooperating model, there are two players, Vanke and another outstanding peer. Our financing model switching will usher in new challenges. In the past, we were able to get a large sum of borrowing, but now we'll switch to the project-based, and the borrowings will be obtained through the progress of the construction of the project. So that's a new challenge for us. A large amount of the money will be in an escrow account, which would restrict the headquarters cash flow, or it would also affect our cash reserve at the headquarters level. That's another challenge. And thirdly, about the operating business, we have over RMB 300 billion, very close to RMB 400 billion, the business operation, while the EBITDA or EBIT has not reached the interest rate of the bank, which means that our operating business returns cannot cover overall the interests or the ramping up interests specifically. That's the third challenge. I would call it the three scissors difference. Well, what would be our response to the three scissors difference if our scale declined? For some peers, they have already provided some kind of an example. If they're able to have a RMB 100 billion declining scale, then they can get the 5.0x EBITDA to strike a balance. So the RMB 100 billion decline of scale could be balanced with the RMB 5 billion EBITDA. So for the first and third challenge, it's just like on two sides of the scale. We need to step up our efforts in our business operation to create more EBITDA for us, including the NOI and NPI. While for the second challenge, our financing model switching, like I said earlier, now the bank has provided one, two, three years of a lenient period or the transitional period, just like the old saying, "If God closed the door, then he or she would open two windows for you." One window is the project whitelist. That's one alternative for us to respond to this unbalanced issue. Like I said earlier in the presentation, it's about RMB 19 billion over 30 projects in the whitelist. We've been applying for more inclusion of our projects into the whitelist. It's an embodiment of the coordinated financing policies from the authority. We're able to get more borrowing from our development business. We also pay close attention to the operating loans for property service. In the previous three months, we have additional RMB 10 billion operating loans. And internally, what we are trying to do is to streamline the configuration of our capital to improve our operating efficiency so as to maximize the utilization rate of the operating loans. Currently, we don't have a very good utilization rate. We do have a lot of resources and rich assets. We also have a lot of qualified assets for the operating loans. We have around RMB 10 billion for the operating loan balance. And that would boost our cash flow to provide new cash sources. Of course, while switching to this new financing model, talents or headcounts is a cruel issue. In the past, we always say that you only need to have more headcount in order to tackle through the challenges. But now, we need additional headcount, not just three people, but maybe 10 times or 30 people are needed. So we need additional headcount for that purpose. We have also checked the background and CVs of our staff. We have 176 of our Vanke employees. They have over three years' working experience in financial institutions. So we do have a lot of talent reserve as well as the ability to support the switching of the financing models. We are able to make it. Now, set aside all that, all the three challenges that I have just talked about. For today, we have confidence to make it to switch to this new financing model. Maybe initially, we had suffered some headwind, but now we have much clarity in mind. More importantly, Shenzhen SEZ Construction Group and also our major shareholder, Shenzhen Metro Group, they have provided billions and very close to RMB 10 billion substantial support so as to further support us to go through this cycle. So additional funds will be adequate. And we are able to fill up existing capital gaps. And also, like I said earlier in the PowerPoint slides, we also have over RMB 100 billion debt reduction plans for the interest-bearing debt. So we do need all sorts of support and also with our own efforts to make it through. Now, I'd like to summarize with two sentences. Even though we are suffering a lot of headwinds, but we have also received numerous support from our shareholders and also from financial institutions. We are just like a small ship that is trying to sail through mountains. Our efforts have been echoed by our partners and stakeholders. We are able to ride through the tides. Okay. Thank you, Mr. Zhu. Now, we'll open the floor for the next question. The next question is from Zhang Liang from Shanghai Securities. Please. Good morning, dear management. I'm from Shanghai Securities. I am Zhang Liang. I have a question about the sales. According to statistics, in the first two months, the top 100 property developers, their sales have dropped 50%, whereas for Vanke, dropped by 40%. So my question to the management is that against the current market confidence level, it's still in the recovery process. So what would be our responsive strategy for the delivery? Okay. Thank you. Thank you, Mr. Zhang Liang from Shanghai Securities. Your question is mainly about market confidence has not fully recovered. And against the background, how can we come up with better selling strategy? Thank you, Mr. Zhang Liang, for your question. I would respond to your question. In Q1, the sales and also the collection, it's our primary task to stabilize our sales. In 2023, we have achieved over RMB 370 billion sales volume and also over 24 million sqm. While in Q1, we have managed to sell over RMB 36.6 billion. Judging by these numbers in January and February, indeed, it's a decline compared with the previous year. If you look at the performance last year and also in January and February this year, we still ranked the Tier 1 players in the industry. Now, specifically, down to the operational level, we've been giving full play to our pricing operational strategies to better coordinate our selling strategy and also to improve the granularity of our daily operations to have better results. Now, I would also like to report to you about the structural moves that we have undertaken in 2023 or last year. Our total inventory, we have sold over RMB 19 billion with about a 63% of a selling rate. Compared with 2022, we have improved 3%, among which the non-residential projects, we have over RMB 36 billion. While out of the non-residential inventory, we have also achieved RMB 9.6 billion for the Tier 1 buildings. So we have done a good job in terms of the selling-through rate for the pipeline or for the inventory projects. And also for the invested project, we have 28 operating projects last year in 2023 that have been in surveys and started the sales. And now, we have about RMB 54.4 billion, about a 20% GP margin. And in between, in 2023, these are some of the statistics that we have acquired in 2023. We have 26 projects sold in 2023, about RMB 48 billion. According to our statistics, the average cycle is about 120 days. While for the new projects, the investment and also the fund collection, in the past two years, we pay close attention to the product ability as well as the operating efficiency to have better selling results. We have made stable progress. We've also been stepping up our effort to drive the sales results. Our product lines are customer-centered, an all-factor consideration. We would carry out a customer profile survey, quality improvement, as well as improving the investment returns for our project. That's what we mean by full-factor consideration. Following this product development logic in the past year, targeting the improvement targets, customers, our product has been received very positively by the market, not only to guarantee our sales volume, but also the quality and efficiency has been drastically improved. I'd also like to report about during last year's results announcement, it's already been talked about how we work with the low-carbon initiative in Shanghai. The project's going very well. The low-carbon and intelligent technologies are playing a very crucial role. Now, that project, technology-wise, we have 25 patents. And that community, it's about 400,000 sqm GFA, including commercial property, office buildings, as well as the leasing apartments. And the commercial apartments and public amenities, about 400,000 sqm. And that community, after operation, the carbon emission dropped by 31% compared with a normal community. The carbon cut is about over 5,000 tons, which is equivalent to the carbon absorption of 253,000 trees per year. Also the PV panels at the roof, each year, they can generate over 2.5 million kWh, which can supply 3,000 households for their annual electricity consumption. After the operation, these PV panels could reach this amount of power generation as well as decarbonize the community. In the future, for these urban projects, in this new urbanization process, these projects have been exploring new pathways for an onward-looking trajectory. On one hand, we would continue to sell with more proactive effort and also to consolidate our internal capabilities. Just like what my colleague had just said, we're just like a ship sailing through the mountains. Thank you. Thank you very much. Thanks for Shanghai for your response. Let's welcome the next question, please. Coming next, let's welcome Chen Zhong from CITIC Securities. Thank you very much. I'm Chen Zhong from CITIC Securities. Just now, the management team has already responded to the inventory structures and the sales. I have a follow-up question. The first question is regarding impairment provisions. How are you going to comment on the impairment provisions? It did truly reflect the risk in the market. My second question, I know that property developers, majority of them, are facing the downward performance. Your development GP margin in the second half of 2023 was also going down. What would be the outlook of the GP margin of development business? Thank you. Thanks for Mr. Chen from CITIC Securities. You'd like to ask about whether we have enough impairment provisions that truly reflect the market risks. And you also would like to know the GP margin of the development business. Let's welcome Madame Han to respond to the question. Thank you. Thanks for Mr. Chen. Let me just respond to the impairment provision. Vanke always sticks to the very prudent financial strategies. Every year, we're going to have the impairment test over all the projects, including the projects unconsolidated and the JV projects. So actually, it's a dynamic process. For this year, actually, impairment provision is around RMB 4.58 billion, including the JV projects. And the provision is around RMB 3.5 billion. And it's going to impact our attributable profit by RMB 3.55 billion. We made sufficient impairment provision as far as I consider. Starting from the year of 2022, altogether, we made impairment provision of close to RMB 30 billion. What you can see from the consolidated statement is around RMB 9 billion, but altogether, the number is RMB 30 billion. According to the market landscape, we believe we made sufficient impairment provision. We're still going to keep prudent strategies to dynamically monitor the projects and then to see whether we need to make further impairment provision or not. The second question is regarding the average decreasing of the performance. Yes, indeed. The performance has been impacted by the shrink of the contracted sales and the GP margin reduction and also impairment provision. So the performance has been down by 46%. Regarding the business scale, the revenues have been reduced down by 7.6%. The GP margin has also been reduced from 19.6% to 15.2%, down by 4.8 percentage points. So the business scale shrinkage and the GP margin reduction impacted our GP margin hugely. So altogether, the GP margin has been reduced by RMB 20 billion, along with the impairment provision factor. So altogether, attributable profit has been somewhat impacted. Regarding your question on GP margin, this is indeed actually a concern of the market for the past few years. GP margin going down is also a common practice of the whole industry. Actually, our project settlement GP margin was 50.7%, down by 4.7 percentage points compared with 2022. It's been going down for three consecutive years. The reason is still because the sales continue to go down. In the settlement projects, altogether, we see that the sales are going down dramatically. For the past two years, our sold yet unbooked sales have been impacted by the downtrend of the total contracted sales. The fundamental changes of the whole industry still shed a negative influence on GP margin. As those projects were delivered in 2024 and 2025, is still GP margin in 2024 and 2025 going to be pressured? What would be the future GP margin may look like? It will still be subject to the market changes and also related to the sellable resources we have. Starting from 2022, GP margin of the new projects looks pretty good. Starting from 2022, we continue to be strengthened regarding investment qualities. Investment fulfillment rate will also be greatly improved, as I have already introduced in 2022. Around the fulfillment rate of the new project investment is around 90%. GP margin of new projects is close to 20%. When those projects get into the settlement stage, it's going to benefit our GP margin improvement. But we have to admit, when the land acquisition used to be quite furious, at that time, we were too positive on the future outlook of the market. Those projects being acquired many years ago still are facing great pressure on GP margin. We'll continue to deinventory those projects for sure. But you can also see that in our annual report, we see the operational service business GP margin continues to be improved. For Onewo, its GP margin has been improved from 40.4% to 50%. Operating business, decreasing the depreciation, the GP margin has been improved by 22.2%, up by 5.2 percentage points. As we continue to improve our business efficiency, it's going to positively contribute to our performance. Thank you very much. Thanks for Madame Han. Let's now welcome the next question, please. Coming next, let's welcome Chen Bo from Caixin to raise the next question. Hi, I'm Chen Bo from Caixin. Last November, Shenzhen SASAC mentioned they're going to leverage market-oriented measures to support Vanke to overcome the difficulties and risks. How about the progress of those measures being implemented? Thank you very much. You were talking about the support from Shenzhen SASAC and how it's going to support Vanke regarding the progress and the implementation. Let me ask Zhu Xu to respond to the question. On 6 November 2023, Shenzhen SASAC actually made a very positive statement, stabilizing the confidence of the whole market. So right after this lead meeting, with great support from Shenzhen SASAC, they actually coordinated many state-owned companies to talk to Vanke to make four major measures leveraging market-oriented yet legalized ways to support Vanke. The four major measures include, first of all, helping Vanke to dispose of those fixed assets with low liquidities and long-term equity investment. Secondly, they're actually leveraging REITs to support Vanke. And thirdly, we also have multiple projects cooperation between Shenzhen SOE and Vanke for industrial-specific projects cooperation. And fourthly, Shenzhen SASAC is also coordinating the financial resources to support Vanke. Well, regarding the four measures, some of them have already been completed, while some are still in progress. When the four measures have been all completed, it's going to help Vanke to further release the liquidities of more than CNY 10 billion. You'll probably see that the SCPG, the price inquiries regarding the REITs of the SCPG, our major shareholder, Shenzhen Metro, actually subscribed CNY 1 billion, accounted for more than 30% of the total fundraising. It's the largest state-owned company that has subscribed to a single order of these REITs. While at the same time, and we also have Haigang Life also made another subscription of RMB 100 million, this indeed shows how the Shenzhen SASAC and SOE and large shareholders support us. All in all, Vanke is not fighting alone. We truly cherish the great support from Shenzhen SASAC and our major holders. We're going to stand and advance and retreat together with our shareholders and continue to strive for the long-term stable development of the company. Now, let's welcome the next question, please. Coming next, let's welcome Peng Yulei from Haitong Securities to raise the next question. Thank you very much. I'm Peng Yilei from Haitong Securities. Just now, we heard some very good presentations from the company. I have a question regarding the return back to the shareholders. Your dividend payout ratio has been maintained at 35%, but all of a sudden, you canceled the dividend for this year. What's the reason? Thank you. Thank you. Thanks for Mr. Peng from Haitong Securities. And you really want to know the reason behind the cancellation of the dividend back to our shareholders. Let me ask Mr. Zhu to respond to the question. Yes, this is really a challenging question. Vanke, after being listed, we always cherish leveraging cash to pay back to our shareholders. And actually, for the past 31 years, our total cash return back to the shareholder is close to RMB 103 billion, and the dividend payout ratio in our track record is 33.3%, actually 2.8 x higher than the equity financing from the very beginning. So the board made a very hard decision to cancel the dividend in 2023 back to the shareholders. The key reason is because the market has still undergone profound adjustments. Some investors, as already mentioned, in January and February of 2024, the top 100 real estate companies, the total sales have been down by 50%. Whereas for Vanke, the sales have been down by 40%. The market has still undergone a confidence crisis. So that's the reason we made some pre-communication with our investors. Many investors, they are not on par with the dividend payout. For the bond investors, they really want the companies to keep enough cash reserve for the liability repayment. For equity investors, some of them understand the company, hope we can keep more money without paying for dividends, to make sure we have a safe operation to take care of the uncertainties of the future. While other equity investors, they rightly want the dividend from the company. By consolidating the voice from all parties, after the in-depth discussion made by the board, we finally decided to cancel the dividends in 2023, supporting the companies to go through the uncertainties in the special period of time. Thanks for the understanding from the investors. Thank you. Coming next, let's welcome the next question, please. Now, let's welcome Wang Bo from Caixin Journal to raise the next question. I'm Wang Bo. I have a question for Mr. Yu. We see for the past few years, demand and supply in property markets have been fundamentally changed. The market is also facing huge challenges. For the past two years, the top 100 property companies, their total sales have been down by 51%, and the newly financing has been down a lot. Vanke is the first company proposed to leave through the difficult time, but there is some doubt in the market on whether Vanke can make it. And also Vanke, for the first time, canceled the dividend back to the shareholders. With the market concerned, what measures is Vanke going to have in order to make sure you still have a safe and sound operation in the extreme situation? Thank you very much. Thanks for Wang Bo for your question. You'd like to know what are the measures we have in such a difficult landscape of the industry. This is a question for Mr. Yu. Thank you very much. Let me help to answer the question. Just now, just following on the previous question regarding dividends back to the shareholders, it's not easy for us to make a decision that breaks the 31-year-old convention. It's not easy. Me and my team fully understand the dissatisfactions of the shareholders. We take all your criticism and the suggestions. But here, I think I have every responsibility to report to our shareholders regarding the ideas in our mind. For the past one year, the property market is still facing the downward pressure. Our company, you know that we made some progress regarding the operation. Regarding ourselves, we stay ahead of the industrial average, maintaining our leadership in the market. And we successfully delivered 289,000 housing units for delivery with very high satisfaction from the customer. As we have already introduced, we have a high fulfillment rate of the newly invested projects. Our product strengths continue to be improved. Those are all the advantages to continue to consolidate our future competitiveness. In our presentation, we have already mentioned about our prefabrication service in Hainan, starting from the product acquisition to completion to sales. It only takes 12-14 months. While in the near future, if the whole industry only allows us to sell the existing well-built and constructed product, then Vanke, to some extent, will already be ready. We also have a large construction management business with many years of practice being accumulated. So in other words, for the development business, Vanke does have very strong fundamentals and competitiveness. Our operating service business also sees very stable growth. And with some nice assets being accumulated, those assets are very popular in the market. For the past one year, our total transactions reached RMB 12.3 billion, actually a very high number in the industry, staying ahead of other peers. We don't actually publicize those data before. So regarding REITs, I think maybe many of you know this action. Our SCPG REIT is already in the price inquiry stage. VX Logistics REIT is still in the application stage. We're also preparing for the long-term rental housing REITs products. So in the year of 2024, possibly speaking, Vanke is going to be the only property company with three REITs in three business categories. This is indeed reflecting the market recognition of Vanke. But if we're going to sustain our business, business is not enough. We still need to have the bottom-line mindset, making sure we have a stress test in the extreme circumstances, making sure we have enough preparations being made in advance. Last Q4, I think we've learned a lesson from the market. I think now our consideration is not comprehensive enough. In order to sustain our business, we need to develop our abilities against a doomsday scenario or against the extreme conditions. Many of our habits or many of the circumstances that we are used to will change. For example, we've been adhering to a very sound financial strategy. We've been maintaining very stable cooperation with financial institutions. However, when there is a panic in the market, when there are declines that surpass expectations, our cooperation model might change. So the steady cooperation with financial institutions in the past might not be adequate to support our future cooperation. So we need to strengthen our capabilities against a doomsday scenario, against duress, and we need to be more thoroughly prepared. So in the future, our crisis awareness should be further strengthened. We would mobilize our assets, turning the fixed assets into a mobile asset. The financial issues are also business issues. We do have reflections on these issues in the past few months. With the management and product improvement, we are trying to digest some of the inventory of projects with a very high land price. For some of the projects, as a natural course of things, they will have a longer cycle to collect the cash. But we've turned the fixed asset into a mobile asset to better match with our cash flow conditions. So in a word, even though we are now facing adversarial conditions, we still have the confidence to sustain our business. We also need to further strengthen the efforts to improve our abilities against the doomsday scenario. So for this year and next year, we have raised objectives to firmly reduce the gear ratio, in particular for the interest-bearing liabilities down by RMB 100 billion, so at a safer margin to better grow our business. The non-dividend policy is an instrument for us to create the necessary conditions so as to sustain our business. With a more long-term-oriented goal, we are able to create investor returns or shareholder returns in a much better way. Starting from last year, we've been vigorously supported by Shenzhen SASAC and Shenzhen Metro, as well as the other key stakeholders and friends. We are grateful for these gestures. Being concerned about the company is because we have high expectations of Vanke. Please trust us that we would spare no efforts to ride through the cycle. We have every confidence to overcome the difficulty and, in this new era of development, to remain our industry position, to outperform the industry. Thank you, Mr. Yu. Now, we open the floor for the next question. The next question is from Citibank, Mr. Chen Jingwei. Please. Good morning. I am from Citibank. Just now, Mr. Yu, you have mentioned our efforts. We have made a lot of progress in our logistics, our warehouse, the rental housing. So according to the management, these three REITs, what kind of support are they able to provide for our operating cash flow? And are there any future plans for more REITs? Thank you. Thank you, Mr. Chen, for your question from Citibank. Your question is about the issuance of the REITs, the progress, as well as the future plans. Okay. I'd like to ask Mr. Liu Xiao to respond to this question. Okay. I'd also like to add some more details about the REITs. On Monday, we have finished the price inquiry. And on April the 8th, we were able to successfully issue the REITs. Now, in addition to the support from shareholders, many of the leading institutions, including Bosera, CCB, the construction bank wealth management subsidiary, all of these players have been very supportive of our efforts, which has reflected that our REITs have been well received by the market. So the purchase day on April the 8th, about 5.2% of rate, we do have a lot of preparations and reserves for the issuance of REITs, including the expansion plans. A very direct result of the issuance of REITs is to enlarge our cash flow. We are going to pay back part of the interest-bearing liabilities while the remaining cash, with the 1.1 billion investment, so there will be an additional RMB 400 million-RMB 500 million cash inflow. So at a more profound level, it would drive our asset operation ability to make the preparations for the controlling of the share. And also, over 50 shopping malls were included in the REITs. But of course, they are going to be incorporated through several rounds of REITs issuance. And I believe that these moves will help in terms of cash flow, the capital at hand, as well as the operating efficiency. These REITs will be highly conducive for our overall business. And on March 1st, we have another milestone, the logistic REITs. It's been processed by the CSRC. So the logistic REITs, the first batch, we have offered three projects. They are located in GBA or in the Yangtze River Delta regions, in the core cities. A large proportion of that are located in the GBA, serving the cross-border e-commerce. Another project in the Shaoxing city, serving the advanced motor manufacturing. We also have another project in Hangzhou, serving the cross-border e-commerce, connecting Shanghai as well as Hangzhou's e-commerce players. The occupancy rate surpasses 98% and also even reached 100%. These are all very high-quality projects. And I believe that these moves opened a new milestone, a new door for logistic REITs. Now, industry-wise, it's tier one. The total asset in the prospectus, it has not disclosed the total asset volume, but the scale actually reached over 12 million sqm. So we do have adequate assets for the logistic REITs. And also, Mr. Zhu has also talked about the rental housing. In two weeks' time, we are going to submit the application materials to NDRC. Also in Beijing, Shanghai, Hangzhou, these will be the key cities for us to issue the REITs with our assets. Now, we have about 230,000 for the rental housing, over 65% of the occupancy rate. So be it a logistics asset and rental housings, we are able to better promote the soundness of our business. Okay. Thank you for your response. We planned to terminate the meeting at 11:00 A.M., but now it's already 11:10 A.M. So So we'll allow for two further questions. Please. Now, the next question is from Mr. Huang Wanying, Daily Economic News. Good morning. I'm from Daily Economic News. I have a question to Mr. Zhu. In a Onewo meeting, you said that 2024 is going to be a very important year, a critical juncture. So I'd like to know more about your attitude about the development of business. Okay. Thank you, Ms. Huang, for the question. So you also take notice about the shareholders' letter from Onewo. So you'd like to know, what does that mean for the development of business? Thank you for your question. Firstly, that wording was included in the Onewo Space- Tech letter to shareholders. I wrote the words about this shore and the other shore. But that's referring to the property management business. We have a lot of service stuff. But 30 years ago, these service personnel, they are known as the logistics department for the development business as part of the developers. But 20 years ago, we have established the Vanke property service, also serving the development business. We do have a financial statement, but the revenues are primarily driven by the group. While 10 years ago, or less than 10 years ago, in 2019, we've worked with Cushman & Wakefield. We have established a comprehensive property service entity. Today, it has evolved to become a more professional entity, in addition to serving the Vanke group, but also for Alibaba, Tencent, Meituan, Toutiao. These are all our clients. While in the financial statement today, as a property management service company, our related party transaction with the parent company, this ratio is trending down on a continuous basis. That being said, in the past two decades, when the property sector was booming, the revenue of a property management company primarily stems from the correlations or the related transaction with the parent company. But now, in this new era of an existing market, for this sector, I mean, we have already reached a critical juncture. If the property management company cannot develop our own strain of businesses, our own customers, if we're overdependent on our parent company, that won't guarantee a bright future for us in the current industry environment. That being said, in retrospect, in the property development sector, like I said earlier, when I was in Vanke, I spent a lot of time for the property development projects. We call the developer business. We also call it real estate asset operator. We have two terms to describe this business. In the past two decades, China has gone through the 20 years of population dividend and also industry upgrade, and of course, with a very aggressive development growth rate. But as to the future, just like Mr. Yu has said earlier in the presentation, in the coming years, the property development business, it cannot go back to the 1.1 billion level, but it will be around 1 billion. So the volume would trend down, but it will be there. If you look at the worldwide data, it's reflected the same pattern. 20 years ago, if you visit Europe, you'll see that they don't really have any issues. 20 years later, it's a completely different story. For the demographics, just like Mr. Yu said earlier, now we have a very low birth rate. In the U.S., from the 70% urbanization rate, if you look at the per capita floor area, I think it's around 1 sqm. But now, we have a 65% urbanization rate, while we only have a 0.7 per capita construction area. So in the future, there will be a lot of space for further growth. Now, if you look at the operation of a fixed asset operation or real estate operation, now with the issuance of REITs and also with the support from the national authorities and also the key stakeholders, for the fixed asset operation or for the real estate operation, now we are entering into a very critical juncture. And also, if you look at the international peers, for instance, the Mitsui Fudosan real estate company in Japan, in history, it's a development-oriented and transaction-oriented company. But today, that company has become the largest REITs manager, about JPY 4.7 trillion. And also, the profit from this business accounts for 70% of the financial statement. And also, after the transition, the coverage has largely dropped compared with the '90s, so dropped by 18%. Now, for Vanke Group, based on our current business layout, we have the residential property development as our main business. And now, we do have the long-term rental housing brand, Boyu. It's been growing very well. At the end of last year, we have already very close to 180,000 apartments. It's close to make it 200,000, and which actually has already started to have the positive profit being made starting from 2022. This is indeed a proactive initiative taken from Vanke of purely doing the development business to the rental business. So when the property market got into the operational stage, I do believe the service capacity, service innovation, and the gene of the service started to become a very important part and a differentiator of the developers. The future customers, they're going to go for the high-quality life, so they need someone who can provide high-quality service to them. This is indeed the trend in the property management service in China. In the past, we have many developers. Their property management subsidiaries have been replaced by the sound and professional property management companies to provide the service to the residents. So no matter what difficulty we encountered here today, as far as I served the company for almost three decades, we'll still be deeply rooted in our gene of providing high-quality service to the customer. That's all for my response. Thank you. Thank you. Coming next, let's welcome the final question, please. Now, let's welcome Wang Huijing from CICC to raise a final question, please. Thank you very much. Thanks for having the chance to raise a question. My name is Wang Huijing from CICC. I have a question. I noticed that Vanke started to improve its efforts for the asset sales, and especially the management has been quite decisive of maintaining sufficient cash positions to well manage your financials. So by the very beginning of this year, you actually sold the Qibao Vanke Plaza to Link and 50% of the equity. Many people believe the transaction price being underestimated. How are you going to comment on that? My second question is regarding the assets or the holding assets for the past two to three years. It seems that you're going to shift your strategies of purely expanding the business to improve the quality and efficiency of the holding assets. So how are you going to plan for those holding assets? Any updates regarding your strategy? Thank you. Thank you. Thanks for Madame Wang from CICC. You notice that the equity transaction of the Vanke Plaza, Qibao Vanke Plaza in Shanghai, the transaction price, you also would like to know the holding assets and its future development strategy. Let me ask Mr. Liu to respond to your question. Thank you. Thanks for Ms. Wang. The company is fundamentally aware of the fact that regarding the operating business, we need to actually have a closed loop of making sure we have a good management. So starting from 2023, we actually be more proactive of exiting some of the projects. Last year, the total exiting transaction reached RMB 12.3 billion. This is indeed a great enhancement regarding the quality of the transaction. Those transactions not only open the new channels for the exits, while at the same time, it also helps us to further improve our operational management capacity, improving the quality assets, and also being inspired as a buyer. This is indeed the strategy we have regarding the operating business. We're talking about Qibao Vanke Plaza. This is actually a major transaction starting from the beginning of this year. The Qibao Vanke Plaza has been put into operation for eight years, getting into a mature and stable stage, and its asset value also hitting the peak. So starting from the beginning of 2023, we prioritized the Qibao Vanke Plaza as the one for exit. Every year, for our asset arrangement, we do have made the list. We also talked with many trading partners. This project is quite special. Our original shareholder, Link, they do have the priority purchase right as we're working together. Both parties have a very good consensus regarding the project positioning and operations. So both parties have been having very good cooperation in the past. So we take Link as the trading partner of Qibao Vanke Plaza. This is actually a good arrangement. As Mr. Zhu also mentioned in the presentation, this transaction actually brings more than 1 billion profit to the company, and the ROI is actually more than 15.7%. In the near future, and when we do further transfer, we're also going to benefit from the future transaction. So the exit of the Qibao Vanke Plaza is in line with our asset planning and also helping us to continue to maximize the value of the project investment. In the near future, the company is going to continue to promote the development from asset-heavy to asset-light business, continue to improve our operational capacity. So I do believe in 2024, we're going to have more asset transactions larger than 2023. First of all, we have more operational business. Their value continues to be improved. And we also have a very mature model and practice for asset exits. We're now having REITs or pre-REIT funds that are going to provide us more alternatives. So just now, we mentioned about the Port A partment. The NOI has been improved by 1.4 percentage points from 2022 to 2023 due to the ever-increasing occupancy rate, operational efficiency, and also the multi-stream of the revenue improvement. So indeed, the operational improvement is a precondition for exits of the key assets. For the past few years, we seldom exit from the major projects. We are also further consolidating our transaction capacity. 2023 is actually a milestone for Vanke. We continue to improve our capacity for major transactions with exits. In other words, regarding REITs or pre-REITs, they're a very important channel for exits. Starting from last year, we actually established the first pre-REIT funds with five projects being transacted. For this year, we're going to have more pre-REIT funds being established. So I do believe in 2024, we're going to have more transactions being done. And for sure, the transaction practice is also going to be optimized. L adies and gentlemen. We 'll be overrun for almost 30 minutes right before the meeting gets started. We also collect questions from the investors and be able to inform the management team regarding the questions. For the past presentation and Q&A, the majority of your questions have been addressed by the management team. But if you have any further questions, welcome to send your question to our IR team, ir@vanke.com, or please continue to talk to us through Shenzhen Stock communication platform. Last year, we responded to 430 questions on Shenzhen Stock Exchange interaction app. Thank you.