\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 754 Shanghai Jin Jiang International Hotels Co.Ltd(600754) )
Core view
In 2021, the revenue recovered by 75%, deducting non performance loss reduction. In 2021, the company’s revenue was 11.339 billion yuan / + 14.56%, returning to 75.10% in 2019; The performance attributable to the parent company is 101 million yuan / – 8.70% (without disturbance), and the non performance loss is 122 million yuan, a year-on-year decrease of 548 million yuan; EPS0. 10 yuan. Among them, the revenue of domestic hotels recovered by about 82%, with a performance of 444 million yuan and a deduction of 366 million yuan, turning losses into profits; Overseas hotel revenue recovered 57%, with a loss of 445 million yuan, a year-on-year decrease; Catering revenue was flat, with a parent company performance of 203 million yuan / – 20.96%, mainly due to the impact of the reduction of dividends of Suzhou Xihang KFC under the epidemic.
The loss reduction in 2021q4 is mainly due to the rebound overseas, while it is slightly under pressure in China. Q4 company’s revenue was 2.990 billion yuan / + 3.26%, recovering 78%, and the parent company’s performance was 3.85 million yuan, turning losses into profits year-on-year; Deduction of non performance was – 77.37 million yuan, a year-on-year loss of 188 million yuan, mainly driven by the Q4 rebound of overseas hotels. Q4 overseas revenue increased by 103.62% year-on-year, and the performance decreased significantly (45 million / 05 million euros for 20q4 and 21q4 respectively), while the revenue affected by the epidemic in China decreased by 9.28% year-on-year, and the corresponding profit decreased year-on-year.
The goal of opening stores in 2022 is the same, and the revenue is expected to increase by 20-25%. In 2022, the company expects to achieve revenue of 13.6-14.2 billion yuan / + 20% – 25%, of which the domestic operating revenue is expected to increase by 9% – 14% year-on-year; Overseas operating revenue is expected to increase by 65% – 70% year-on-year; Meanwhile, it is planned to open 1500 new limited service hotels and sign 2500 new contracts, which is the same as the target of the year announced in early 2021.
Platform integration and scale expansion help growth, take into account the relaxation rhythm of travel policies. In the short term, it is still necessary to track the recurrence of the epidemic in China and relax the pace of travel policies. However, the company is No.1 hotel scale in China. Under the goal of striving for the first hotel scale in the world in the future, the company is still expected to actively expand its scale. At the same time, it is announced that the former CFO general manager Shen (in charge of integration) of the company will be appointed as the new CEO of the company, and the integration of one center and three platforms is expected to be fully strengthened in the future. Among them, with the opening up of members and the unification of charges, it is estimated that the proportion of follow-up central reservations and the contribution of CRS channels are expected to continue to improve, so as to increase the front-end revenue. At the same time, the company’s supply chain, it, property rights trading center and other platforms support. Among them, Jinjiang global hotel trading service platform, which will be launched in April this year, is expected to realize the closed-loop service of the whole life cycle of hotel investment and transaction, and enhance its attraction to franchisees.
Risk warning: goodwill impairment risk, acquisition integration lower than expected, systemic risk, especially overseas epidemic, etc.
Investment suggestion: pay attention to the relaxation rhythm of travel, the midline scale and integration potential can be expected, and maintain “buying”. Considering the impact of repeated outbreaks at the beginning of this year, the eps0.0 in 22-24 years was reduced 77 / 1.85/2.30 yuan (EPS in previous 22 / 23 years was 1.17/1.93 yuan), corresponding to the valuation of 63 / 26 / 21x. The recent frequent outbreaks in many places still bring short-term business pressure, but the recovery can be expected if the travel restrictions are gradually relaxed in the future. From the perspective of the midline, under the goal of the first hotel scale in the world, the company is expected to continue to accelerate its internal integration and external expansion in the future. The growth of the midline is worth looking forward to and maintain the “buy” rating.
