\u3000\u3 Ping An Bank Co.Ltd(000001) 979 China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) )
Core view:
Event: Recently, the company released its 2021 annual report. In 2021, the company achieved an operating revenue of 160643 billion yuan, a year-on-year increase of 23.93%; The net profit attributable to the parent company was 10.372 billion yuan, a year-on-year decrease of 15.35%; The basic earnings per share was 1.16 yuan / share, a year-on-year decrease of 20.55%.
The increase of carry forward brings about the increase of operating income, the decrease of gross profit margin and the decrease of investment income
Factors lead to profit pressure. In 2021, the company achieved an operating revenue of 160643 billion yuan, a year-on-year increase of 23.93%; The net profit attributable to the parent company was 10.372 billion yuan, a year-on-year decrease of 15.35%; The net profit margin was 9.46%, a year-on-year decrease of 3.59pct compared with 2020; Roe was 9.88%, a year-on-year decrease of 2.61%. The company’s annual operating income increased rapidly, mainly due to the increase in the area of project completion, delivery and carry forward, resulting in the increase of real estate business carry forward income. This year’s increase in income but no increase in profit is mainly due to: 1) affected by the downward market, the gross profit margin carried forward by real estate business decreased year-on-year; 2) The provision for asset impairment and credit impairment totaled 4.372 billion yuan, reducing the company’s net profit attributable to the parent company by 3.456 billion yuan in 2021; 3) The investment income decreased, and the investment income generated by the company’s transfer of subsidiaries decreased by 2.445 billion yuan year-on-year, resulting in a year-on-year decrease in the net profit attributable to the parent company of 2.049 billion yuan.
The sales price has maintained double-digit growth, and the sales target in 2022 is 330 billion yuan.
In 2021, the company achieved a contract amount of 326834 billion yuan, with a year-on-year increase of 17.73%, and a contract area of 146447 million square meters, with a year-on-year increase of 17.77%. The sales scale has always been at the leading level in the industry, ranking seventh in the list of Kerui, which continues to rise by 3 compared with the previous year. The company focuses on core cities with intensive cultivation. The sales scale of 7 cities including Shenzhen, Shanghai, Suzhou and Nanjing ranks among the top three in the local area, and the sales scale of 16 cities ranks among the top ten in the local area. The annual sales area and amount increased by more than 17% year-on-year. It is one of the few enterprises to achieve double-digit growth in sales price. In 2022, the company proposed a sales target of 330 billion yuan, which was the same as that in 2021. At present, the basic demand for house purchase is still in the market. It is expected that with the relaxation of demand side policies, residents’ enthusiasm for house purchase will gradually pick up, the fundamentals will recover gradually, and the company is expected to achieve the annual sales target.
Investment focuses on high-energy “strong heart 30 cities” and continues to make efforts in mergers and acquisitions and urban renewal
And realize multi-channel comprehensive expansion. In 2021, the land acquisition intensity of the company was higher than that of other real estate enterprises. In the whole year, 113 land were acquired, and the construction area of new soil storage was 15.59 million square meters, a slight decrease of 4.05% over the same period; The total land price was 215 billion yuan, a year-on-year increase of 41.82%. The company pursues high-quality endogenous growth, focuses on regional focus and urban deep cultivation, and gives priority to core cities with high energy levels such as Shanghai, Shenzhen and Nanjing. In the designated “strong heart 30 cities”, the equity land price investment accounts for 90% of the total investment. It is noteworthy that the company adheres to multi-channel comprehensive development and actively distributes in xiong’an new area, Hefei new station, Wuhan Shenlong, etc. in the whole year, the company obtained 9 projects in terms of industry city linkage and supplemented soil storage of about 2.15 million square meters; In addition, continuous efforts have been made in the field of M & A and urban renewal, and 12 M & A projects have been obtained; Won the exclusive qualification of 14 old reform projects, and established an urban renewal fund with a scale of 80 billion yuan with relevant departments of Shanghai, realizing multi-channel comprehensive expansion.
The financing channels are unobstructed, and it is a green enterprise. In 2021, China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) issued 9 ultra short financing bonds and 2 medium-term notes on a rolling basis, and the coupon rate hit a new low in the near future. The company controlled the financing cost through multiple channels, and the financing environment continued to improve since the fourth quarter. The annual comprehensive capital cost was 4.48%. By the end of 2021, the net debt ratio of the company was 42.82%, the asset liability ratio after excluding advances received was 61.67%, and the cash short debt ratio was 1.25. It was a stable green enterprise, laying a solid foundation for future development.
Investment suggestion: the company has a leading sales growth rate in the industry, obvious financing advantages, development and operation go hand in hand, and a large number of high-quality soil reserves are used as safety pads. We expect the company’s earnings per share from 2022 to 2023 to be 1.40 yuan / share and 1.54 yuan / share respectively. Based on the closing price of 14.55 yuan on March 23, the corresponding P / E ratios are 10.4 times and 9.4 times respectively. We are optimistic about the long-term performance of the company and maintain the “recommended” rating.
Risk warning: the sales deregulation is less than expected and the financing environment fluctuates.
