\u3000\u30006 Shenzhen Guangju Energy Co.Ltd(000096) 00009)
2021 review
Under the influence of the epidemic, the number of passengers transported by airports in China reached 907 million in 2021, an increase of 5.9% over 2020 and restored to 67.1% in 2019, that is, a decrease of 32.9% compared with 2019. In terms of market, affected by the Spring Festival transportation policy and the repeated sporadic epidemics in China, the low point of aviation demand for Chinese routes appeared in February / August / November and the high point in March / April / may / July,; However, due to the strict control of overseas epidemic import by the Civil Aviation Administration, the number of international / regional flights has always been at a low point, with little fluctuation throughout the year. Compared with 2019, the monthly number of international / regional flights has decreased by more than 90%, and only the number of flights in April / July has a slight increase compared with that in 2020.
Shanghai International Airport Co.Ltd(600009) in 2021, 32.21 million passengers were transported, with a year-on-year increase of 5.7%, slightly weaker than 5.9% of the industry as a whole, and a significant decrease of 57.7% compared with 2019. Among them, the passenger transportation volume of China line was 30.53 million, an increase of 19.2% year-on-year, a decrease of 18.9% compared with 2019, and the passenger transportation volume of international and regional lines was 1.679 million, a decrease of 65.5% year-on-year and 95.6% compared with 2019. However, driven by strong freight demand, the company achieved an annual cargo and mail transportation volume of about 3.99 million tons in 2021, an increase of 8.1% over the same period of 20 years and 9.7% over the same period of 19 years.
Compared with other airports in China, the performance of Shanghai Pudong Airport depends more on non aviation income such as international routes and tax-free business rent. Therefore, the sharp decline of international passenger transport has a great impact on the performance of the airport. The company released a performance forecast on January 24, saying that it expects a loss of 1.64 billion yuan to 1.78 billion yuan in 2021, corresponding to a single quarter loss of 436 million / 304 million / 510 million / 390540 million respectively. It is expected that the annual tax-free income is close to 500 million yuan, a decrease of nearly 90% compared with nearly 5 billion yuan in 2019.
At the beginning of 2022, the moderate recovery trend continued
However, with the improvement of China’s epidemic situation and the relaxation of travel control, China’s aviation demand as a whole shows a strong resilience and rapid recovery trend. In January 2022, 599476 passenger flights took off and landed at airports in China, an increase of 1.7% year-on-year, an increase of 11.78% month on month, and a decrease of 25.28% compared with January 19; Among them, the recovery degree of Chinese flights increased compared with the previous month, with a month on month increase of 11.84%, a year-on-year increase of 0.66% in 2021 and a decrease of 17.46% compared with 2019; However, international / regional flights increased by 4.28% month on month compared with December, decreased by 41.66% year-on-year in 2021, and decreased by 95.07% compared with 2019. There is still no obvious sign of recovery.
According to the announcement of Shanghai International Airport Co.Ltd(600009) , it took off and landed 29735 aircraft in January, a year-on-year increase of 13.99%; The number of passengers transported was 2.1183 million, a year-on-year increase of 14.47%; The volume of cargo and mail transportation was 318700 tons, a year-on-year decrease of 10.43%.
Recently, the government announced the 14th five year plan for civil aviation, which defines 20212022 as the recovery period and savings period of China’s civil aviation industry, while 20232025 is the growth period and release period. It will focus on expanding the Chinese market and restoring the international market, and vigorously develop the freight market. We expect 2022 to become the performance inflection point of airport companies, The performance will rebound from 2023.
Confirmation of 19.1 billion asset injection and overall listing plan
According to the announcement, Shanghai International Airport Co.Ltd(600009) signed an agreement with the controlling shareholder airport group to price the 100% equity transaction of Hongqiao Airport at about 14.5 billion yuan, the 100% equity transaction of logistics company at about 3.1 billion yuan, and the transaction of the fourth runway of Pudong Airport at about 1.5 billion yuan, totaling about 19.1 billion yuan. The listed company is expected to issue about 434 million shares to the airport group, The issue price is 44.09 yuan / share. At the same time, the company issued no more than 128 million additional shares to the airport group, and the supporting financing scale was reduced to no more than 5 billion yuan, with the issue price of 39.19 yuan / share. The raised funds are intended to be used for the company’s type IV airport construction project, smart cargo station project, smart Logistics Park Comprehensive Improvement Project and supplementary working capital. After the completion of the transaction, the airport group held 58.38% of the total share capital of the listed company (46.25% before the transaction).
We believe that the business of Hongqiao Airport, which is mainly engaged in Chinese lines, has recovered relatively rapidly. Injecting into listed companies will realize the re integration and optimization of route resources, and will have good development prospects and strong profitability in the long run. Affected by the epidemic, Pudong Airport, which is dominated by international routes, has high operating costs. In order to make more rational and efficient use of resources, Shanghai International Airport Co.Ltd(600009) has tried to turn a large number of idle international time resources to the Chinese market, so as to make the passenger flow of Pudong Airport pick up faster. In addition, the reorganization will also be put into the logistics and freight business, which will help to improve the air freight hub network, expand multimodal transport and optimize the freight layout of the two venues in Shanghai.
Investment advice
We believe that with the improvement of vaccination rate, although the process will still encounter challenges and twists and turns, the road to recovery is clear, and the airport dragged down by the epidemic is about to usher in the dawn after going through the darkest period. In the future, the tax-free value of Shanghai International Airport Co.Ltd(600009) will return, and the performance of the company is flexible. As the injection of additional assets has not been completed, the relevant impact will not be considered temporarily. We adjusted the forecast value of EBITDA per share of Shanghai International Airport Co.Ltd(600009) 2021 / 2022 / 2023, and adjusted the target price upward to 62.3 yuan (originally 56.3 yuan), corresponding to the valuation multiple of Na / 45.8 / 29.2 times and the rating of “overweight” respectively. (current price as of March 1)
