Jiayou International Logistics Co.Ltd(603871) (603871)
Event: on December 20, the company issued a non-public issuance report. After deducting the issuance expenses, the net amount of funds raised was 577 million yuan; At the same time, Zijin Mining Group Company Limited(601899) announced that it plans to invest more than 1.2 billion yuan in Jiayou International Logistics Co.Ltd(603871) and will obtain more than 20% equity.
Zijin Mining Group Company Limited(601899) became the second shareholder of the company in various ways to reduce transportation costs and improve logistics efficiency. The leading position of Jiayou mining engineering logistics has been confirmed again. There are three ways for Zijin Mining Group Company Limited(601899) to participate in Jiayou International Logistics Co.Ltd(603871) . First, Zijin Mining Group Company Limited(601899) transferred 42.375 million shares held by Han Jinghua and Meng Lian, the actual controllers of the company, and the controlling shareholder jiaxinyi (Tianjin) asset management partnership for about 850 million yuan, and about 2.675 million shares held by Wu Zibin and other shareholders of the company, totaling 45.05 million shares, with a transfer price of about 18.9 yuan / share; second, Zijin Mining Group Company Limited(601899) Its enterprises participated in the company’s non-public offering of shares, contributed about 390 million yuan and subscribed about 20.98 million shares at the price of 18.49 yuan / share. Third, the company under Zijin Mining Group Company Limited(601899) purchased about 1.25 million shares of the company through the secondary market. After the completion of relevant transactions, Zijin Mining Group Company Limited(601899) will hold about 67.28 million shares of the company in total, accounting for 21.23% of the total share capital of the company. The equity ratio is only after Han Jinghua, the actual controller and his concerted actors, and become the second largest shareholder of the company. Although Zijin Mining Group Company Limited(601899) previously designated Jiayou International Logistics Co.Ltd(603871) as the whole process logistics carrier of project equipment and materials of Congo (DRC) commus company, which has proved that the company has strong service ability in relevant fields, we believe that this shareholding is Zijin Mining Group Company Limited(601899) ‘s further recognition of the company’s business ability.
The non-public offering is finally implemented. Although the yield of the raised investment project is not high, it is expected to deepen the moat of the company’s China Mongolia business. In August 2021, the company announced the second revision of non-public offering of a shares, and the total amount of funds to be raised shall not exceed 584 million yuan, Invest in the technical transformation project of service trade infrastructure (RMB 396 million), the purchase of loader vehicles (RMB 50 million) and supplement working capital (138 million yuan). The project aims to improve the environmental protection index and automation rate of China Mongolia business and supplement working capital. Although the after tax financial internal rate of return of the company’s fund-raising projects, service trade infrastructure technological transformation projects and the purchase of loader vehicles are only 8.37% and 11.24%, and the economic benefits are relatively general, considering that environmental protection and automation are the basis of the company’s business development, we should take a longer look , environmental protection may become a bottleneck in the development of coal related businesses, which may deepen the moat of the company’s business.
The African project will be put into operation soon, and Zijin will take shares or endorse the project income of the company. The company’s African highway port project is expected to be completed by the end of 2021, and the construction of sakania border port is expected to be completed by the middle of next year. The total investment of the project is 230 million US dollars, and the payback period of the project is only 544 years. In May, Zijin Mining Group Company Limited(601899) ‘s kamoa kakula copper mine project in the Democratic Republic of Congo was completed and put into operation. After full development, the annual output of copper exceeded 800000 tons at the peak, and the market’s confidence in the yield of the project is expected to be strengthened.
Investment suggestion: one belt, one road, cross country multimodal transport, the invisible champion. Although 2020-2021 is subject to the epidemic situation, the performance of the company is relatively general. But with the dissipation of the epidemic, the volume of business volume in China and Mongolia has been restored to a relatively fast growth trend. The commissioning of African projects will not only increase the revenue for the company, but also prove the effectiveness of its business layout model of light, medium and heavy. Considering that the impact of the epidemic in 21 years exceeded expectations, and African roads are expected to contribute revenue quickly, the profit forecast of 21-23 company was adjusted from RMB 347 / 472 / 628 million to 3.28 / 5.11 / 7.19, corresponding to PE valuation of 21.4 / 13.8 / 9.8x, and the rating was raised to “buy”!
Risk tips: the epidemic situation has repeatedly exceeded expectations, the company has lost customers, safety accidents and the economy has declined beyond expectations
