Cts International Logistics Corporation Limited(603128) (603128)
Key investment points
The gene inheritance of central enterprises is superimposed with market-oriented incentives to build an international freight forwarding giant
Cts International Logistics Corporation Limited(603128) is mainly engaged in international freight forwarding logistics business. In addition, it cuts into the cross-border e-commerce logistics track to share high prosperity dividends. On the one hand, the company has a deep gene of central enterprises, on the other hand, it implements market-oriented incentive and is full of vitality in operation and management. In line with the development path of international cross-border freight forwarding giants desway and Desun, the company has deeply implemented the extension M & a strategy, achieving a compound growth rate of 11.0% in operating revenue and 23.3% in net profit attributable to the parent company from 2009 to 2020; 3q21 revenue further increased by 69.2% year-on-year to RMB 16.602 billion, and the net profit attributable to the parent company further increased by 75.1% year-on-year to RMB 670 million.
Three dimensional advantage superposition to consolidate the basic plate of international air and sea freight forwarders
Traditional freight forwarding business has four characteristics: light asset operation, limited service links, mainly undertaking offline B2B business and cost plus pricing. The high dispersion of key node resources in the dimensions of region and link determines that the international freight forwarding industry is in a decentralized state for a long time. Cts International Logistics Corporation Limited(603128) the three-dimensional advantages of cargo volume scale, resource integration and customer structure are prominent, and the scarcity of cross-border air and sea transport capacity resources since the epidemic has once again verified the three-dimensional advantages of the company. The gross profit per ton of air freight forwarding business of the corresponding company increased from 1164 yuan / ton in 2009 to 2494 yuan / ton in the first half of 2021; The gross profit per container of ocean freight forwarding business increased from 260 yuan / TEU in 2009 to 539 yuan / TEU in the first half of 2021, and the basic market of international freight forwarding continued to consolidate.
Cross border e-commerce logistics business has opened up an important second growth pole, and the scale growth is expected to exceed expectations
In terms of profitability, compared with traditional international freight forwarders, cross-border e-commerce logistics has more categories, higher frequencies, longer links, high service requirements and long performance chain, pushing up the profit ceiling. From the perspective of demand space, the expansion of the "plate" of China's cross-border e-commerce industry drives the improvement of the scale of the cross-border e-commerce logistics market. Airy consulting expects the scale of China's cross-border e-commerce export logistics industry to grow at a compound growth rate of 22.5% from 21e to 25E. Since 2019, the company has successively acquired high-quality projects such as Da'an project, Shenzhen create supply chain and Jiacheng international, and actively entered the cross-border e-commerce logistics market. There is room for share growth and profit improvement in the future.
The two central enterprises integrate their logistics business, and the company's cross-border logistics core asset position is expected to be more prominent
In March, the listed logistics companies of Chengtong Group and tiewu group announced that the two groups are jointly planning the integration of logistics business. At the end of November, the State Council approved the implementation of specialized integration between Chengtong Group and tiewu group's logistics sector. In December, China logistics group was officially established, which was integrated by the original tiewu group and three logistics companies under Chengtong Group. SASAC of the State Council and Chengtong Group hold 38.9% respectively, and China Eastern Airlines Group The three strategic investors of COSCO Shipping Group and China Merchants Group hold 10%, 7.3% and 4.9% respectively, and will hold Cts International Logistics Corporation Limited(603128) 45.8% equity. Cts International Logistics Corporation Limited(603128) as the only entity operating cross-border comprehensive logistics in the listed platforms of the two groups, it is the core asset to escort the upgrading of China's high-end manufacturing industry to the sea. It is expected that after the implementation of this integration, the empowerment of the three strategic investors will be superimposed to highlight the status of cross-border logistics core assets.
Profit forecast and valuation
We expect the net profit attributable to the parent company from 2021 to 2023 to be RMB 869 million, RMB 1066 million and RMB 1221 million respectively, with a year-on-year increase of 63.8%, 22.7% and 14.6% respectively. Considering that the company, as a central enterprise giant of China's cross-border comprehensive logistics track, has a solid freight forwarding base and broad new business space for cross-border e-commerce logistics, it is expected to benefit from the national strategic integration of the central enterprise platform of modern logistics industry in the future, and give a "overweight" rating for the first time.
Risk warning: the price of international cargo transportation fluctuates greatly; Cross border e-commerce consumer demand fell; The goodwill of M & A is impaired.
