A construction worker leaves a China Vanke Co site in Beijing. Vanke said it will rapidly build homes on the land it buys. Keith Bedford / Bloomberg

SHANGHAI - China Vanke Co, the country's biggest developer by market value, said demand for its homes will withstand government efforts to cool speculation this year after it became the nation's first real estate company to surpass 100 billion yuan ($15.2 billion) in annual sales.

"Our customers are mainly those who buy and live in their homes," Vanke's President Yu Liang said in a statement late Monday after Shenzhen-based Vanke reported a 37 percent gain in 2010 profit that exceeded analysts' estimates. "Speculators faded after government curbs."

Vanke shares climbed to a three-week high after the company pledged to continue its "quick turnaround" policy for building homes, damping concern sales will slow. China has boosted downpayment ratios, restricted loans and raised interest rates three times since October as it seeks to cool home prices and prevent an asset bubble.

The developer's "prices and profit margins exceeded estimates because of significant increases in house prices in 2010", Yin Zi and Zhu Jin, analysts at Shenyin & Wanguo Securities Co, wrote in a report Tuesday and maintained their "buy" rating. "The company's ability to defy the industry cycle is better than its rivals' because of sound asset quality and cash flow."

The stock rose 1.79 percent to 8.53 yuan at the close of the Shenzhen market on Tuesday, the highest since Feb 16, bringing the year's gain to 3.8 percent.

Net income last year climbed to 7.3 billion yuan, or 0.66 yuan a share, from 5.3 billion yuan, or 0.48 yuan a year earlier, the company said in a Shenzhen Stock Exchange statement on Monday. That's more than the 7 billion yuan average estimate of 15 analysts surveyed by Bloomberg.

Vanke said it will quickly build homes on land it buys rather than hold sites, a strategy that helped drive sales last year. Contract sales rose 71 percent to 108 billion yuan in 2010, making it the first Chinese developer to exceed 100 billion yuan, and reaching a target it set for 2014. Developers typically sell homes and book earnings from the properties progressively as they are developed.

"Vanke will take the same strategy in 2011 to serve the demands of our customers," said Yu. "Vanke is maintaining its policy of no hoarding of land and homes, and a quick turnaround of projects."

About 88 percent of Vanke's 2010 home sales were from apartments of 144 square meters or smaller, Yu said.

Revenue rose 3.8 percent to 50.7 billion yuan, the Shenzhen-based developer said. The company also cut administrative costs, which fell to 1.7 percent of sales expenses last year from 2.3 percent in 2009, it said.

Vanke said on Feb 24 it was "confident" sales will stay above 100 billion yuan in 2011. Contract sales more than tripled to a record 20.1 billion yuan in January and doubled to 6.1 billion yuan last month, it said. Vanke had about 38 billion yuan of cash at year-end, up 64 percent from early 2010, according to the statement.

"The momentum of the company remains good," Frank Chen, a Hong Kong-based property analyst at BNP Paribas Securities SA, said before the earnings. "It won't be very difficult for their sales to stay above 100 billion again this year."

Goldman Sachs Group Inc said Vanke's contract sales estimate for 2011 has been "locked in" based on data in the first two months and revenue it hasn't booked from 2010. Average selling prices in the first two months also suggested that margins will improve further in 2011 and 2012, it said in a report on Tuesday, maintaining its "buy" rating on the stock.

The company has operations in 46 cities after entering 12 markets last year, including Kunming, in Yunnan province, and Urumqi, in Xinjiang Uygur autonomous region. It added 87 new projects last year.

China's property prices increased every month in 2010, the year the nation surpassed Japan to become the world's second-largest economy.

Last year, the government imposed measures including a ban on third mortgages to curb speculation. This year, it raised the minimum downpayment for second-home purchases and told local governments to set price targets for new properties, and introduced residential taxes in Shanghai and Chongqing.

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