Shanghai Jin Jiang International Hotels Co.Ltd(600754) (600754)
1、 Event overview
Shanghai Jin Jiang International Hotels Co.Ltd(600754) announced on December 1 that after the absorption and merger of Jinjiang capital, Jinjiang International will inherit the Shanghai Jin Jiang International Hotels Co.Ltd(600754) 45.05% equity held by Jinjiang capital and form a direct holding of the company. Previously, Jinjiang capital announced on November 24 that Jinjiang International plans to merge Jinjiang capital and directly control Shanghai Jin Jiang International Hotels Co.Ltd(600754) ; Jinjiang International gave Jinjiang capital a cancellation price of HK $3.10 per share, revoked its listing status and the official delisting time of H shares, which will be announced later.
2、 Analysis and judgment
Jinjiang International directly holds Shanghai Jin Jiang International Hotels Co.Ltd(600754) , and the actual controller has not changed before and after the transaction
Before this acquisition, Jinjiang capital was currently the largest shareholder of Shanghai Jin Jiang International Hotels Co.Ltd(600754) , holding 45.05%, Jinjiang capital is controlled by Jinjiang International, a wholly-owned subsidiary of Shanghai SASAC (holding 75%). Through Jinjiang International, Shanghai SASAC forms a control over Shanghai Jin Jiang International Hotels Co.Ltd(600754) It holds 71% equity of Jinjiang International, holds 19% equity of Jinjiang International through wholly-owned holding of Shanghai real estate, and the other 10% equity is owned by Shanghai Municipal Bureau of finance. After this transaction, Jinjiang International will directly hold Shanghai Jin Jiang International Hotels Co.Ltd(600754) 4.82 trillion shares, with a shareholding ratio of 45.05%, and the actual controller of Shanghai Jin Jiang International Hotels Co.Ltd(600754) is still Shanghai SASAC.
This integration aims to reduce management costs and improve enterprise operation efficiency
The Hong Kong stock price and liquidity of Jinjiang capital are low, which is difficult to support the company's financing needs. This absorption and merger can simplify the company's management level, save the cost required to maintain the listing status of Jinjiang capital, improve the overall operating efficiency, and realize the strategic layout of the overall business development of Jinjiang International. The acquisition report also fully makes it clear that after the acquisition, Jinjiang International has no plans to change the main business of the listed company, carry out major asset / business disposal or reorganization, the board of directors and senior executives of the listed company, articles of association, employee employment, dividend policy and organizational business structure of the listed company in the next 12 months, and promises to maintain the independence of the listed company.
In the future, the limited service hotel business of Radisson is expected to be injected into the listed company
Jinjiang International acquired Radisson hotels in 2018 and owns some limited service hotels, forming a horizontal competition with Shanghai Jin Jiang International Hotels Co.Ltd(600754) . In this regard, Jinjiang International promises to actively seek solutions and integrate with the company's business in a timely manner. Radisson Hotels Group currently has more than 1500 hotels under construction and operation worldwide; It has 9 hotel brands, among which Radisson is the largest in Europe / the sixth largest super high-end hotel brand in the world; After the establishment of Jinjiang Greater China in May 2020, four brands of Radisson China, Liyi / Lirui / Park Plaza / rapoo, have been integrated into Jinjiang China. In the future, other Radisson limited service hotels may be injected into the company to promote the continuous strengthening of Shanghai Jin Jiang International Hotels Co.Ltd(600754) medium and high-end brand reserve / operation management ability and further improve the brand layout.
3、 Investment advice
In the post epidemic era, the supply and demand structure of China's hotel industry has been significantly optimized. In the follow-up, with the spread of vaccines and the introduction of specific drugs, the epidemic situation has been controlled and the channel for the recovery of the industry boom has been opened. After the acquisition, Shanghai Jin Jiang International Hotels Co.Ltd(600754) is directly controlled by Jinjiang International, and the management and operation efficiency is expected to be improved; As the only hotel listing platform under Jinjiang International, it is expected to get more resources in the future, and get the injection of limited service hotels under the parent company, so as to further consolidate its strong position in the middle and high-end track. It is estimated that the net profit attributable to the parent company in 21-23 years is RMB 280 / 15.3 / 2.05 billion respectively, and the corresponding PE is 198 / 36 / 27x respectively, maintaining the "recommended" rating.
4、 Risk tips:
Macroeconomic fluctuation risk; Repeated outbreaks exceed the expected risk; Risk of intensified industry competition; The extension store is less than the expected risk.
