\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 669 Power Construction Corporation Of China Ltd(Powerchina Ltd)(601669) )
Event: Power Construction Corporation Of China Ltd(Powerchina Ltd)(601669) announced that from January to February 2022, the total amount of new contracts signed by the company was about 121182 billion yuan, a year-on-year increase of + 1.67%. Among them, the amount of newly signed contracts in China was about 101278 billion yuan, a year-on-year increase of + 1.35%; The amount of newly signed contracts abroad was about 19.904 billion yuan, a year-on-year increase of + 3.34%. Among them, the newly signed contracts for energy, power, water resources and environment, infrastructure and other businesses of the company are 22.194 billion yuan, 34.795 billion yuan, 52.234 billion yuan and 11.959 billion yuan respectively, and the number of newly signed projects is 455, 227, 394 and 153 respectively.
Comments:
Orders in a single month increased slightly year-on-year, and the growth rate of foreign orders increased significantly. In February 22, the newly signed contract amount of the company was about 55.687 billion yuan, a year-on-year increase of + 0.04%. From the company’s historical order data, the proportion of newly signed contracts in February of 20 and February of 21 in the annual order amount was 6.34% and 7.13% respectively. From a regional perspective, in February of 22, the amount of newly signed contracts in China was about 49.079 billion yuan, a year-on-year increase of – 2.89%; The amount of newly signed contracts abroad was about 6.608 billion yuan, a year-on-year increase of + 29.01%, and the growth rate of foreign orders accelerated significantly (January 22 was – 5.96%).
The proportion of large orders increased significantly compared with the previous month. According to the large order data released by the company, the total amount of newly signed large orders (single orders with a contract amount of more than 500 million yuan) in February 22 was about 28.688 billion yuan, accounting for 52% of the newly signed contract amount in that month, which was significantly higher than that in January 22 (29%). The signing of large orders helped the company maintain a positive growth in the newly signed contract amount in February 22. In terms of the types of large orders, China’s newly signed large orders in February 22 are mainly distributed in the field of infrastructure and new energy construction, including rail transit, new urbanization, affordable housing, pumped storage power station, water conservancy engineering, comprehensive treatment of water environment, water resources allocation and other sub fields, mainly water conservancy engineering and comprehensive treatment of water environment. Foreign newly signed large orders are mainly distributed in C ô te d’Ivoire, Myanmar and other countries, involving smart new town, commercial complex and other fields.
Profit forecast, valuation and rating: Power Construction Corporation Of China Ltd(Powerchina Ltd)(601669) has competitive advantages in the fields of power construction and operation investment, water conservancy and water environment treatment and operation. In February 22, the company’s orders maintained steady growth and continued to make efforts in the fields of comprehensive treatment of water conservancy, hydropower and water environment with competitive advantages. We are optimistic about the company’s business development in the field of new energy power generation operation assets and its competitive advantage in the engineering field during the 14th Five Year Plan period. Maintain the company’s EPS forecast of 0.58 yuan, 0.65 yuan and 0.72 yuan from 2021 to 2023, and the current price corresponds to the company’s 22-year dynamic P / E ratio of 13X, maintaining the “buy” rating.
Risk tip: the demand for contracted construction of new energy power generation projects is lower than expected, the growth rate of newly signed orders slows down, the project payment collection is lower than expected, and the profitability of real estate business is lower than expected.
