Dear analysts, dear investors, good afternoon. Welcome to China Resources Land 2018 interim results announcement. Today with us are Mr. Tang Yong, Vice Chairman and Executive Director, Mr. Yu Jian, CFO and Executive Director, Mr. Xie Ji, Senior Vice President and Executive Director. First of all, Mr. Tang Yong, Vice Chairman, will deliver a speech.
Dear analysts and dear friends, good afternoon. Thank you very much for your coming for this results announcement. It is still raining outside. Thank you very much indeed. Today is a very good day. I know that some big developers are conducting their results announcement today, and it seems that everybody has a very good performance. I know that this is a very busy time for you. It is the results season, and it is also the peak season for you, being an analyst.
Thank you very much for your great support from the investors and the analysts. I am very happy to have this opportunity and communicate with you about our performance. On behalf of China Resources Land, as well as our management team, I would like to extend our sincere gratitude to you. Your support is the most effective motivation to us. Thank you for that. Our report of interim results is already available online, and you may have already noticed the details of our report. Before our CFO shares with you more details, I would like to say a few words about our overall performance. First of all, in the first half, there is a big increase in our turnover, reaching CNY 43.8 billion. We already changed the currency to RMB, and this means a 40% of increase.
This is the 43% of increase in our investment property as well. Secondly, including the hotel sector, this is the CNY 4.4 billion from our hotel sector, representing 22% of increase. Thirdly, under settlement profit margin also reached a historical high, representing a 13.1% of increase. In the DP sector, the 48.6% of increase. In the DP gross margin, there was a 3.1% of increase, reaching 36.6%. The profit attributable to the shareholders is the CNY 8.85 billion, representing 96.3% of increase. The core net profit also increased by 152%. The dividend payout ratio will also go up by 30%, and the overall dividend payout ratio will be maintained at 35%. The board of directors has already determined that the dividend payout will be CNY 0.11 or equivalent to HKD 0.13.
In 2018, our contract sum also delivered very good performance. The target will remain the same as stated at the beginning of the year, and the total contract sum reached CNY 94.3 billion, representing 36% of increase. We have a full confidence that we can hit the target as said at the beginning of the year on the contract sum. Number seven, in the first half, the overall financing environment became tougher and the cost also went up. The overall financing cost is 4.4%, slightly increased by 25 basic points. The gearing ratio increased slightly, but our overall balance sheet is also very healthy. The net interest bearing gearing ratio is 47.2%, still lower than the average in the market. We have a long-term commitment to our shareholders. While managing the risk steadily, we will realize the growth as well as the returns to our shareholders.
In the short to medium term, we will stick to the stable growth of the company while the industry is going through consolidation. We are trying to expand our market share, meanwhile maintaining a very good balance sheet. Currently in the industry, we are one of the best performers in the market. In the long run, we are exploring the X strategy to realize the transformation and innovation in our business. In five years to 10 years of time, we will transform ourselves in terms of our residential property and investment property being two engines of our growth. We will innovate in the operations, the long-term rental, as well as the other innovative businesses in order to deliver the new compelling force of growth in our business. We realized the progress in different business segments. Mr. Yu Jian will share with you more details in a minute.
I think I must stop here. Mr. Yu Jian will continue with the presentation. After that, we will open the floor for questions. Thank you.
Thank you very much, Mr. Tang. Actually, Mr. Tang already talked about all the key points of our performance. First of all, thank you very much for your consistent attention and support. There will be six parts in my presentation. First of all, about the company overview. You have already known our company very well, so I will skip this. Let's start from the business performance in the first half. As Mr. Tang already said that our overall performance increased dramatically and the returns to the shareholders also went up dramatically. From January this year, we changed the function currency to RMB. Therefore, you can see in the financial statement that all the figures are indicated in RMB.
As Mr. Tang said that our turnover was RMB 43.8 billion, up by 40%. The investment property rental income increased by 22%, reaching RMB 4.4 billion. Gross margin also hit a historical high, reaching 48%, up by 13 percentage points. The profit attributable to shareholders was RMB 8.9 billion, up by 96%. After the evaluation influence of investment property, as well as after that, the core profit attributable to shareholders was RMB 7.3 billion, up by 152%. This year, we see such an improvement in this area. EPS is RMB 1.28, and the dividend payout ratio will be 30%, that is RMB 0.11 or HKD 0.13. This represents an increase of 30%. The contract sum also increased by 36%, reaching RMB 94.3 billion. Financing cost is still at a lower level in the market.
In my estimation, the same period last year, there will be a 25 basic points up, reaching to 4.41%. The net interest varying gearing ratio will be 47.2% because of more expenditures on land acquisition in the first half. Let's look at the financial performance. The income statement. In our P&L, we see improvement in all business sectors, the development properties and the investment properties. In the investment properties, operations efficiency improved, gross margin reached 66.6%, and the net profit increased by 22%, increased by 5.7%. Core net profit increased by 7.3%, reaching 16.6%. For this diagram, I wouldn't go into the details. Let's look at next slide and the balance sheet. The cash balance increased by 13%, reaching RMB 60.9 billion. Interest-bearing debt increased by RMB 30.3 billion. By the end of June this year, we hold more cash in hand because of the micro adjustment from the government.
The financing environment becomes tougher. In the interim reporting period, the net interest-bearing debt increased by 11.3%, reaching 47.2%, because of more land acquisitions and therefore more settlements. This influenced our net interest-bearing debt. This year in the first quarter, a lot of our debt were due and about RMB 10 billion in January, the RMB 7.5 billion in one month only. Meanwhile, the central government asked all SOEs to reduce the gear ratio. Oftentimes during the overall financing cost, we have arranged a perpetual debt of RMB 5 billion with a domestic bank in China. Within three years, it's a 5.9%, and after that, for every year, there will be a three basis points up. It will be a very flexible scheme, after six months, we can pay the debt earlier, so our gear ratio can be reduced to a more reasonable level.
If we consider the perpetual debt as interest-bearing debt, it is estimated that the net interest-bearing debt by the end of June will be 42%. At the end of the year, it can be reduced to 42%, that is the December this year, if we continue taking the perpetual debt as interest-bearing debt. By the end of this year, the net interest-bearing debt will be 42% lower than the current level. In terms of the debt structure, in the first half, because of the newly added debt, the overall interest generation increased by 35%, reaching RMB 2.8 billion. In the total debt, the RMB is RMB 135.9 billion, bank loans 75%, bond financing 25%, fixed interest debt 41%, floating interest 59%. By the end of June, the weighted financing cost is 4.41%.
In terms of foreign exchange and exposure as well as the risks, because the RMB is weakening and perhaps you are concerned about it a lot, therefore, we conducted a very detailed analysis. At the end of June, our foreign currency debt took 29% of our total debt of the company. In my memory, it's RMB 38.8 billion in foreign currency. The proportion was basically at the same level, but the total sum increased. At the end of last year, it was RMB 30.8 billion. You can see there's RMB 800 million increase. Putting aside the overseas foreign currency assets as well as the currency swaps, the non-RMB exposure will be reduced to 22% from 23% of last year. In the future, we will take different measures to further reduce the foreign currency debt.
Meanwhile, we will also continue to use the different vehicles, such as a swap, to hedge the risks at appropriate times. We also conducted a sensitivity analysis. At the end of June, Hong Kong RMB exchange, suppose that in the second half, RMB continued to depreciate by 5%. Of course, we think RMB will be stable. Say, if it depreciates by 5%, in terms of our cash flow, the influence will be RMB 430 million in our P&L. The overall influence will be a loss of RMB 2 billion in the whole year. In our balance sheet, we estimate that at the end of the year, there will be 0.5 of increase in the reserves. This is based on our assumption of a 5% of a depreciation of RMB in the second half. Next slide is about the settlement of our development properties.
In the first half, you can see the details of the settlement sum area and average price. Total settlement is HKD 36.5 billion. Total area is 1.94 million sq m. The unit price increased by 82%, reaching RMB 18,844 per sq m. For the high-margin settlement projects, brought in 6% of increase in the gross margin, reaching 48.6%. In Tier 1 cities, for example, Shenzhen, the settlement was RMB 12.2 billion. Shenzhen, one year for animal, for the gross margin were both above 70%. In Tier 3 cities, the gross margin is even higher, reaching 41%. Specifically, there were 2 projects. One is in Nanchong, the other one is in Shijiazhuang. The 2 projects in Tier 3 cities both have very high gross margin. Therefore, the settlement gross margin in Tier 3 cities are very high. In Changzhou and Nanchong, not Nanchong and Shijiazhuang.
These 2 projects, the settlement sum is also very high, accounting for 40% of our total settlement among the Tier 3 cities. As for the contract sum, it is quite transparent. There are 3 statistics. First one is the full statistics. This is after full consolidation, is HKD 94.2 billion. The other one is the HKD 83.3 billion by equity statistics, as well as the HKD 72.8 billion of the operating equity. From the allocation of the projects, 88% of the contract sum comes from Tier 1 and Tier 2 cities. The top 5 contract sum projects are listed here. It's quite evenly distributed. Next slide is about investment properties and their performance in finance. There's a 28% of our gross margin increase, including the hotel sector. The overall gross margin, including hotel sector, is 66.6%. Putting aside the hotels, the gross margin will be 74.1%. Very good indicators.
You can see we already realized profit of HKD 26 million or HKD 27 million. In terms of our investment size, we are still a leader in the market. By the end of June, we have 27 shopping malls in China, including 16 The MixCs, as well as 11 Hi 5s, and 3 are located in 20 cities. Our total retailing sum was HKD 21.4 billion, up by 30%. For the investment properties, the fair value also has a 7.6% increase, reaching HKD 106.7 million. Our investment properties are mainly shopping malls. As for the cap rate, we used the same cap rate as we did last year. Next slide. There are 2 types of our shopping malls. One is those that were opened before 2012, 7 of them, very mature shopping malls.
From end of 2012 to now, 6 years already, such as Shenzhen The MixC, over 10 years, the overall yield on cost maintains around 10%. The returns from our rental increased about 10%, and the yield on cost also increased by 3.3 percentage points to 35.1%. There's another type of shopping malls, that is those after 2014. In the Beijing Phoenix City Shopping Mall, there is a food court, therefore you can see the occupancy rate dropped slightly. In 2017, we opened 6 new shopping malls. The rental income increased by 7%, reaching RMB 430 billion. Yield on cost also increased. Annualized income from the retailing also enjoyed an increase. You know that we have 3 shopping malls that did not perform very well. One is in Wuxi, the other is in Chongqing and Zhengzhou, The MixC.
These three projects. Here is the performance of these three shopping malls. You can see that through the continuous optimization of attendance, the financial and operations performance both improved. The rental income and the retailing sum both increased. The occupancy rate also increased. Gross margin also improved. The overall profitability is pretty good. This is a list of our major investment properties, the rental income, as well as the occupancy rate. In the first half, there is a 31.9% increase in the rental income. Putting aside the China Resources Times Square, because it is being renovated, and also putting aside the new shopping malls that were opened between 2017 to 2018, there was a 14.1% increase in the organic increase. As for the rental income and the occupancy rate of office buildings and hotels, the office buildings delivered very stable increase.
The 32% of revenue in the rental revenue has raised. There is also 11% of our growth in the rental increase. As for the hotels, the performance also improved greatly through the stringent control on operations cost, as well as the mall campaigns. The overall performance also enjoyed a growth. The same-store growth enjoyed a 16% growth. Without the newly added hotels, this is the same-store increase. The occupancy rate also improved by 5.5%, reaching 62.2%. This is our opening plan. We will have altogether 48 shopping malls, and by 2020, there will be 48, and the total operating area will be 6.1 million sq m. In June this year, the Chongchuan MixC already opened in Nantong, Taiyuan, Guangxi, Shenzhen, Xiamen, and Chongqing. These MixC projects will also be opened. The general occupancy rate is also very good.
This is about our land bank. By the end of June this year, our total land bank, we are holding 52.15 million sq m. We have land in 62 cities. The total land reserve is 43.22 million sq m, or equity land reserve of 33.66 million sq m. In Beijing-Tianjin-Hebei, in Yangtze River Delta, as well as the Bay Area, we have our land reserves. By the end of June, our investment property has the land reserves of 8.93 million sq m or equity area of 6.56 sq m. This represents an 8.2% increase. Let us look at our 2+X business model. Let me talk about the X. We concern more about the organic connection between different business segments to promote the municipal upgrading or the renovation, the city operations and the development, long-term rentals, and so forth.
For some of this business segment, we started earlier, and currently, we are holding over 26 million sq m in our land reserves. Meanwhile, because of the industrial property is booming, we also expanded our channel of land acquisition in order to cultivate a new source of growth. In terms of city development and operations, we also enhanced our output, and currently, we increased the light-asset model, and currently, we signed contracts. In terms of the total construction assets for third parties, this contract sum already exceeded CNY 40 billion. In the 2+X strategy, the central government supports long-term apartment rental business, and by the end of 2020, our target will be about 100,000 apartments. In terms of the senior caring business, we have launched about 5,000 beds for the senior citizens.
If everything goes well, our total number of beds will be 15,000 by the end of the year. As for the smart property, in order to further improve the operations efficiency, we are working together with Tencent to develop the smart property program to deliver value-adding services and realize multiple services, such as fire fighting, communication, transportation, energies, and so forth. In terms of property management, we're also working hard to improve the operations efficiency. The total revenue brought by the property management is RMB 1.9 billion. We are managing 72 million sq m. By 2020, this will be 200 billion sq m. Then this is the appendix land acquisition. We acquired 41 projects in the first half, and the total land price is RMB 67.3 billion. Equity land price was RMB 51.3 billion, and in Hong Kong, the land price is higher.
Putting aside Hong Kong, the average price is some RMB 7,650 per sq m. This is for the scheduled for bookable area. This is the floor areas for settlement. In 2018, it will be 9.25 million sq m. In 2019, 11.15 million sq m. There are some other slides where you can see more details, and you can check them out by yourselves. Thank you very much. Now I would like to open the floor for questions. Please raise your hand if you have a question to ask, just for the interest of time. Three questions maximum for each person. Please identify yourself before you raise a question. Good afternoon, investment. Ronnie from JPMorgan Chase. Three questions for you.
Number 1, in terms of development properties, you're also very active after the injection of a capital, after the liquidation, you are working very aggressively in this. I just want to know, in terms of senior caring or long-term rental apartment and property management, you have a 2020 targets, right? In terms of development properties, can you share with us what your target for this sector? Continuous development or sustainable development is very important. Mr. Tang said in 2018 you're trying hard to exceed your target for the year. What about 2019? I just want to know your target. This is the first question, and this is involved in the land acquisition. In Hong Kong, you are more active than before in land acquisition in Hong Kong. Just I want to know your land acquisition strategy.
In the first half, you spent a lot of money in land acquisition comparing with last year. You also acquired more land. What is your target for the growth of a development property? The second question is about the debt structure. You issued perpetual debt to reduce the financing cost. From this perspective, I see that in the first half, the dividend payout ratio reduced slightly. Just I feel that the overall debt level also increased slightly, and the share price is not low. I just want to know that from the debt level, can you please share with us more details so that the investors don't have to worry too much? The third question is about the investment property, the rental income. I committed with Mr. Ye before, for China Resources, your sales increased. The rental income increase doesn't match each other.
You also adjusted your rental contract. I just want to know what is the latest information about this. In the sales growth and the rental growth, are they matching with each other? In the future, what do you think about their growability? Thank you very much. Perhaps I can take the questions first, number 2 and number 3, and Mr. Tang will take your first question. Dividend payout. Last year, the overall dividend payout ratio was raised to 35%. We estimate that, as we said before, we will not lower the dividend payout ratio, but for the interim. The interim last year was not high. It's about HKD 0.10. This year, we increased it by 30%, reaching HKD 0.13. The dividend payout ratio will not lower down. About the perpetual debt, SASAC asked us to control our liability and assets ratio.
That is to say, you have to enlarge your shareholders' equity. This is one way for overallotment. The perpetual debt is another option. In the long run, we will try to speed up our sales and the settlement, the overall cycling. The reason why we issue perpetual debt is that we do not consider on the issuing any new shares or overallotment. This year, we don't see such a specific requirement for this unless there's the major requirement for M&A purpose or major opportunity arises. If we grow the business organically, I don't think we will consider on the equity financing. As for the investment property, this year, our occupancy cost, comparing that last year, bounced back a little bit. Rental income increased by 31.9%. Retailing increased by 30%. Occupancy rate is 14.4%. In the past, it was 14.2%.
You can see there was also a slight recovery. We will continue adjusting the tenant structure, including trying to set up the close connection with the retailings. The first question, in the past few years, whenever we communicate with analysts and investors, we repeatedly say that we pursue for organic growth and sustainable growth. This is our basic principle. In 2016, 2017, there was a faster growth in our business. This year, it's 20% of growth only. I believe that based on our performance in the first half, comparing that of last year, there was also a very faster growth. While we pursue higher efficiency and growth, we also consider about the returns. Without the returns, any growth will not be meaningful. The increase in the scale doesn't necessarily mean the increase of our returns to our shareholders.
We have to balance both of them. Our growth target will not change. We have also considered about the policy influence. We also deployed more in the tier 2 city after the pre-sale permits from the government. We hope that we can do more than the target. Next year, I believe that the 2 digits growth will be a must. It will be guaranteed double-digit growth. In terms of our debt, you can see the debt increases very fast because of more investments. In terms of our capacity of growing our business continuous in the future, we see such a potential. We have confidence. I said that double digit, I believe that we can hit the target, as I said at the beginning of the year. As the Hong Kong market, we hold positive view on the Hong Kong market in terms of demand and supply.
You may have already felt that in Hong Kong, demand is still strong. The land supply and house or apartment supply is quite limited. In Hong Kong, the market has the feature, the interest rate is held, but the IOR is a little bit lower. This is revenue in the overseas market, and there is also assets allocation in this market. That is why we have made investments in Hong Kong in a reasonable manner and a rational manner. We haven't increased more investment in Hong Kong. This is also a rational decision. In 2019 and 2020, we will continue to maintain the good growth here. In the past, I didn't share any figures, and I don't think it is rational for me to give you any specific this year. Anyway, there will be a rational growth in this year. Good afternoon, management. CICC, Eric. A couple of questions.
Number one, gross margin. China Resources has been leading in gross margin, and this year it increases to 48%. Of course, we know that the settlement may be a very important factor. I just wonder for this, the gross margin, how much is to be recognized of the sales? Last year, the land price for you, a little bit higher. Just I want to know what will be the gross margin from the sales? What will be the trend? This is about the gross margin. Second question, about land acquisition. In the market, the price control is more stringent than before, and in the foreseeable future, we don't see that such regulation will be loosened. China Resources is a big SOE in terms of land acquisition. What is your policy? What is your strategy in the market?
Do you think that you will have opportunities to acquire more land? The third question, a very quick one, about motivation. This is also some expectation from the market. Mr. Tang Yong, please update with us what is your motivation plan. Gross margin. The settlement gross margin will not be sustained, 48%. We will be in trouble if it can sustain. As for the gross margin to be recognized after sales, it is about HKD 201 billion. This year, about HKD 96 million. The gross margin will be 45%. Next year, it will be HKD 67.4 billion, and the gross margin will be 40%. In 2020, it will be HKD 40 billion, and the gross margin is 35%. After that, the gross margin will be around 40%. This year, the overall gross margin will be over 40%, and no doubt about it.
Next year, it will be at least above 35% as gross margin. This is about the gross margin. As for the land acquisition, we estimated and calculated based on our feasibility study, 22%-30% after the weighting pricing. We acquired 41 pieces of land, and the gross margin will be around 29%-30%. This is about gross margin and land acquisition. The motivation, Mr. Tang Yong. A quick comment to our CFO first. 30%-35% of our gross margin will be sustained after 2019. If you look at the total number of projects that are sold to be recognized, we have also considered about the curbing factor, the price curbing factor from the policy, from the government. In the short run, this policy will not be loosened, and the government is quite determined on it.
We also believe that this will help with the long-term growth of the whole industry. This is my comment about gross margin. As for investment, you may wonder that in some places there are a lot of policies, but in some other markets, the markets are not very good, and there are less policies from the government. Demand and supply is not good. If we want to sustain our business in the long run, we have to go to those more bigger and better cities, such as the core cities, the capital cities, the provincial capital cities. This is the way we follow the demand. Because this is the way that industrial and the consumption will grow. If you look at the U.S., in the countryside, the properties are very cheap. In L.A., in N.Y., the properties are more expensive.
It's the same logic. As for infrastructure, the high-speed railway, the metro, the underground or metro lines. This supplement infrastructure will come up very quickly. This is a major concern for us in the tier 3 cities. The policy, the market, and your growth pressure. For me, I think for some pressures, they are too anxious. For any industry, it's impossible to maintain the 30%, 40% of growth, right? Except one or two industries, such as high-tech companies. Development, property industry is a very traditional industry. We have to manage our strategy well. We have to manage our investment well. We have to stick to the principle for creating value to our shareholders, that we can keep moving forward continuously and sustainably. I think this is something that we have to persist as the investment strategy. This is about strategy.
About motivation, is every time you try to touch this pain point of ours, generally speaking. SASAC controls about the total payout, total payroll, but we have a long-term motivation plan. The long-term motivation plan is linked to our core profit. In the past few years, our core profit has been growing steadily and healthily. This is because of our persistence, as well as the motivation-oriented program. If you look at the program now, it is in compliance with creating values for the shareholders. What is left? After considering all factors, it's really a core motivation program. Apparently, such motivation is needed in all SOEs, even though it is not sufficient enough. That's why we have to keep optimizing this program.
I know that you can't wait to see more about the progress in our motivation program, but everybody is happy because our performance is good, everybody is happy. With or without motivation, we have already done a good job in our performance. This is the bottom line, right? Of course, with a motivation plan in place, it will be even more helpful. Of course, within the limited framework, we are optimizing such a program, such as the strategy, our organizational structure, the project evaluation, as well as the distribution. Good afternoon, management. First of all, congratulations on your good performance. It's Liu Yuqing from BOCI. First of all, a follow-up question. As Mr. Tang talked about the turnover rate, last year and the year before last year, you mentioned about speeding up the turnover rate.
I just want to know that you will continue with this goal. The second question is about the occupancy cost. You said that there is a slight increase. How should we understand it? Is it good? Is it bad? Or isn't it a trade next for you to undertake an even higher occupancy cost? Can you please elaborate a little bit more? Third question, every year you may be asked, but still I want to ask that again. Recently, there's some peers, some colleagues, particularly those from IP, said that you are going to have some kind of a securitization program in the near future. After the value increase in your properties in the first of few years, your IP value already exceeds CNY 100 billion. This is the half of the market cap, so this is a huge value that is not fully reflected in your share price.
Will you do something about it? Thank you. Three questions. The first one, turnover. I think our attitude is very clear. We have to keep improving our capability and speed up our efficiency. This is our arrangement, we have already made progress. In the past one or two years, our performance improved, and this is because of our hard work in this area. Secondly, we are trying, we are exploring on the evaluation and motivation based on projects. We also made some progress. The third one about the turnover rate, I must say that if you look at the returns to our shareholders, your turnover times by your market rate, our margin times by your leverage and the ROE. If the company, our gross margin is higher, the turnover rate must be managed well.
If the returns to shareholders are not high, the turnover will be very low efficiency of our returns. I said it before, we are managing the projects at different categories. Some projects needs to have higher turnover, the value of the projects and the value of the company must be both optimized. The direction will be the same, the turnover rate must be also done with good quality. The occupancy cost, your second question. Occupancy cost went up slightly for the company, for the tenants. It is good news because of the sales performance. The sales went up for the tenants, and the returns to the company also went up. This is a win-win situation. 14.1% is not a very high percentage in the industry. I believe that the further improvement will be helpful for us to deliver higher returns to our shareholders.
The optimizing tenants, as well as improve our business performance of the tenants, will also be reflected in our own performance. This direction is a good one, within a reasonable range. If the tenants' cost went up too quickly, the health of our long-term structure will be influenced. I think that's my part for your questions. The securitization. Securitization, last time we had a meeting, and we talked about it already. We conducted systematic research on it, including selling to firms, including lawyers, as well as spinning off. We also produced a mature report to our headquarters, and they are discussing about it. Generally speaking, for the company, by 2020, occupancy rental will be about CNY 10 billion, and we will be able to survive independently. If we do it, spinning off will be the best option.
As for how in the future, the management, actually our parent company, will analyze about different options. We have good assets. We don't worry about our future. Thank you. Good afternoon, management. Griffin from Citibank. Two questions for you. The first one, you said that you want to be one of top 10, right? Mr. Tang said in 2019, the double-digit growth. Is that a bit conservative? How do you think about the target of being a top 10 company? What will be the difficulties for you? For example, the liability assets ratio? The second question, you have about 62 million sq m in the city renovation projects. For example, in Shenzhen, in Hubei Village project, will it be possible that in 2020 or around 2020, will you be able to form up a large supply of these projects?
Personally, if you look at our land reserves, our balance sheet, and the capability of our team, I think becoming a top 10 company is reachable and it is also something we will try best to hit this target. I have confidence that we can do it, but ranking, we are not any indicator to our performance, and this is not what we are looking for. The growth of the business, the values to their shareholders, actually the profit increase, including creating long-term value. These are our targets. For example, our sales, for example, your market cap, your share price, as well as the profit growth and the value to the shareholders. If you have anything to worry, you have to worry about the value that you create. How to stimulate to deliver what the market wants to say? This is a different story.
The long-term value to the shareholders is more important for us. We do not do what the market expects in the short run, but rather we focus on the long run. We are more rational to keep a balance between short-term and long-term goal. You also talked about our debt level. As we said before, some developers of the debt level, because our debt level is not very high, we haven't received recognition from the market, perhaps because of the lower debt level. Sometimes, you have to speed up the overall turnover in your development or in your investment. When we formulate policies, we have reached a consensus with the parent company to set up a long-term sustainable strategy. This is my answer to your first question. For example, we have about RMB 500 billion in our total assets.
Having such a big size of business, definitely you have to be a top 10 company. Otherwise, how can you deliver returns to the shareholders? On the bottom side of the investment property and the assets for it, you have to keep improving your capability in order to deliver more the high returns for the shareholders. As for the city renovation projects, there are a lot of projects. As Mr. Yu said that we have about 26 million sq m in Shenzhen, in Dongguan, and in Guangzhou. In terms of our city renovation projects, in this industry, we are one for the influencer and we are one for the pilot. We have already won trust from our partners, from the communities to the governments. Other projects we mentioned today, they are under construction. The government approved it and the communities also recognize it.
In the future, there will be more projects like those. In 2020, there's possibility that we will form such sellable resources. Other projects are undergoing at different phases. All these projects are mentioned. They are approved and they are recognized by government and the communities. For example, in Dachong, when the development is basically done, some more projects will be ready from our pipeline. In tier 1 cities, we will be able to form our stream of sellable resources to contribute profit and the margin to us, and this will be good news for us. The speaker didn't use microphone just now. Good afternoon, management. A few questions for you. First of all, commercial.
The retailing sum is not growing as fast as before. Investors do care a lot that your rental income and retailing sum both had a very good performance in the first half, yet the trend has changed, and the whole process is slowing down. For the management, you have shopping malls, have also noticed such a trend, that the growth of retailing is slowing down. In the upcoming two to three years, how do you think about the rental income? Will it be a positive rental increase? It's a upward revision? If you renew a contract, the rental income will continue to go up, or you're not sure about the trend? The second question is about innovation business. This year, you talked a little bit more about the innovation business and your targets.
Just want to know, do you have a plan, for example, how much resources you're going to invest in innovation business? Okay, thank you. Retailing sum. If you look at our own figures in the past few years, the growth speed is slowing down. I'm comparing the figures within the company. In the first half, the base is smaller. Comparing with the same period last year, it is higher. Nationally, it is 9.4, a little bit lower than last year. If you look at the figures in the company, this growth will be sustained, and the growth will not as big as last year. This is because of the base, the base of comparison. Your second question about the rental income, the rental growth. We also think that it is sustainable.
Whether the rental can be sustainable or not, it depends on the traffic, the members, the transactions, and whether we can maintain the healthy growth of these indicators. In this way, if all of them are growing, then our rental income will be sustained. Based on the indicators, we know the renewal of contract is already growing. A quick comment. Recently, some big brands, they opened stores in China. They worry a lot about the economic growth as well as the trade war. When they open new stores, they may have to consider more about these factors. Currently, their worries are not reflected yet. Innovation business. The resources for innovation business, we are rational in this area, investing resources in it, not a lot of investment, about less than 5%. This year, it will be within 5%.
I think for some of the innovation businesses, the ROI is still waiting to be discussed and analyzed. We have to consider about our finance capability and management capability as well. Just for the interest of time, the last question, please. Good afternoon, management. Morgan Stanley, Leif. A question about your figure. Just now you said that you estimate the end of the year, the net gain ratio will be reduced to 42%. I just want to know what will be the assumptions for this? We estimate the overall profit in the year will be more than what I said before. Of course, it was also based on the opportunity for us to acquire more land. At the end of the year, the land price, if we get any good opportunity of a land acquisition, gain ratio will be higher.
We have this seasonality, and we are maintaining our credit ratings so far. I can share with you more figures so that you don't have to ask questions one by one. The cash flow. Sales cash collection, HKD 62.5 billion in the first half. Investment property invest revenue, HKD 4 billion. The land expenses, HKD 46 billion. Construction and installation, HKD 19 billion. Sales and overheads, HKD 14 billion. Tax, HKD 19 billion. From the joint ventures and the subsidiaries, dividends and investment collected, about HKD 3 billion. Sellable resources. I also read out the figures for you. By the end of June, our inventory is RMB 76.8 billion. It is estimated that in the second half, there will be 117 newly added resources for sales. In Q4, it will be HKD 530 billion. Overall, the sellable resources in the second half will be HKD 274 billion.
In the appendix, you can find all the details. For the sales and the retailing, it's about over 10% of growth in the mature shopping malls. Seven mature shopping malls, 13.4% of growth in retailing. 21 comparable shopping malls, 17% of growth. This is the full comparable shopping malls. In Shenzhen, the mix is 2.8%, in Hangzhou 30%, in Shenyang is 26%, in Shenzhen, the mix is 28%, in Chengdu 12%, Nanning 14% of growth. In Zhengzhou, it's 23%, Chongqing 35%, Wuxi 12%, Qingdao 10%, Hefei 30%, Guangzhou 25%, Wenzhou 25%. Any further questions? Okay. Once again, thank you very much for your coming for the interim results announcement. There's a bus downstairs to Longfor and to JW Hotel.