\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 350 Shandong Hi-Speed Company Limited(600350) )
Key investment points
Profits recovered in an orderly manner, and the overall performance was in line with expectations
On the revenue side, benefiting from the increased revenue from the acquisition of Luyu company and Yikang technology company, the company's operating revenue in 2021 was 16.204 billion yuan, a year-on-year increase of 24.61%. On the profit side, the double rise in output and price of reconstructed and expanded roads combined with the better performance of rail transit group, the company realized a net profit attributable to the parent company of 3.052 billion yuan in 21 years, with a year-on-year increase of 33.83%. Among them, the net profit attributable to the parent company in the single quarter of 21q4 was 988 million yuan, a year-on-year increase of 4.54%.
The Growth Logic of production reconstruction and expansion of Jiqing and Beijing Taiwan core roads continued to strengthen
The Growth Logic of core road products Jiqing and Jingtai road is in the strengthening stage:
1) in terms of Jiqing Road, the toll revenue of Jiqing Road on the 21st was 3.665 billion yuan, an increase of 84.3% over the same period in 19 years. The average daily revenue increased by 35.4% compared with the average daily revenue of 2016 before the reconstruction and expansion. The subsequent closure and restriction of multiple connecting lines and the elimination of adverse weather and other accidental factors will lead to a further significant increase in revenue compared with that before the reconstruction and expansion.
2) in terms of Jingtai Road, the reconstruction and expansion project of ludqi section of Jingtai road was completed and opened to traffic in the middle of July 21, with a cumulative actual investment of 10.191 billion yuan; By the end of 2021, since the commencement of the reconstruction and expansion project of Jitai section, 63.1% of the subgrade works, 48.5% of the pavement works and 49.5% of the bridge and culvert works have been completed. The two-way traffic has been resumed six months in advance and the left acceptance of the main body has been completed. We expect that the reconstruction and expansion project of the whole line of Jingtai road is expected to be completed and opened to traffic by the end of 2023. After the reconstruction and expansion of Jiqing Road, the steady growth of performance will drive the profit center to move up significantly.
The performance of rail transit group is stable and good
In 2021, rail transit group, a subsidiary of the company, realized an operating revenue of 4.338 billion yuan and a net profit attributable to the parent company of 332 million yuan, a year-on-year increase of 2.21%. The quality and efficiency of railway transportation have been steadily improved. The railway freight sector has achieved an operating revenue of 2.109 billion yuan and a total profit of 277 million yuan. New achievements were made in the development of equipment manufacturing sector. Railway construction equipment company had a revenue of 703 million yuan and a total profit of 126 million yuan in 2021. It won the bid for 2.06 million sleepers of Guinea Masi railway, breaking the highest record of overseas sleeper orders in the same industry in China. The consolidated report shows that the performance of rail transit group is stable and good, reflecting the effectiveness of the company's return to the main business of large transportation.
After focusing on the main business, the business risk was narrowed, and the acquisition of Qilu Expressway led to profit growth
On the one hand, the company has gradually set up real estate business since 2017, and withdrew 40% equity of Jitai mining and 30% equity of environmental protection industry in 2021. After the strategic return to the main business, the operating risk has been significantly narrowed; On the other hand, the company's accelerated acquisition of high-quality road products is expected to drive high profit growth. The acquisition of Qilu Expressway shares has been implemented; In 21 years, the revenue of Qilu expressway was 1.995 billion yuan, an increase of 18.1% over 1.690 billion yuan last year, and the profit was 853 million yuan, a year-on-year increase of 37.5%. Looking forward to the future, the company will also adhere to the expansion of the main road industry and related diversified equity investment. While promoting the acquisition of the main road industry, the company will participate in leading expressway companies outside the province, and choose the opportunity to layout the fields of transportation technology, smart expressway, new materials and environmental protection.
60% high dividend ratio promises to support the absolute return
In 2021, the company distributed a cash dividend of 0.4 yuan / share (including tax), the dividend payment rate was 63.05%, and the dividend proportion commitment was still fulfilled. The company previously released the shareholder return plan for 20202024, promising that the annual cash dividend ratio will not be less than 60%. Corresponding to our profit forecast, it is estimated that the dividend rate from 2022 to 2024 can reach 7.9%, 9.3% and 10.5% respectively.
Profit forecast and valuation
We expect the net profit attributable to the parent company from 2022 to 2024 to be 3.348 billion yuan, 3.985 billion yuan and 4.468 billion yuan respectively, corresponding to 7.6 times, 6.4 times and 5.7 times of the current share price PE respectively. The Growth Logic of the company's reconstruction and expansion is in a period of strengthening and rising. Strategically, it continues to return to the main business of large transportation, superimpose high dividends, attack and defense, and maintain the "buy" rating.
Risk warning: the growth of traffic flow is less than expected; Compensation measures for free passage are less than expected; The consolidated company's performance is lower than expected.
