\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 155 Seazen Holdings Co.Ltd(601155) )
The revenue increased steadily, with the net profit attributable to the parent company – 17.4% year-on-year, and the overall gross profit margin of commercial support: in 21 years, the company achieved a revenue of 168.23 billion yuan, a year-on-year increase of + 15.6%, a net profit attributable to the parent company of 12.6 billion yuan, a year-on-year increase of – 17.4%, a net profit margin attributable to the parent company of 7.5%, a decrease of 3.0pct compared with 20 years, and a basic earnings per share of 5.59 yuan / share, a year-on-year increase of – 17.67%. From the perspective of itemized Revenue: 1) the revenue from real estate development and sales reached 158.12 billion yuan, a year-on-year increase of + 14.9%; 2) Property rental and management achieved a revenue of 7.97 billion yuan, a year-on-year increase of + 46.6%. We believe that the main reasons for the decline of the company’s net profit attributable to the parent company are as follows: 1) the company has withdrawn 5.3 billion yuan of asset impairment loss according to the principle of prudence, a year-on-year increase of + 202%; 2) The company’s investment income in joint ventures decreased from 2.89 billion yuan in 20 years to 2.07 billion yuan in 21 years, a year-on-year decrease of – 28%; 3) Due to the influence of historical high price carry forward and superimposed price limit policy, the company’s gross profit margin in 21 years was 20.4%, down 3.1pct from 20 years. According to the breakdown of gross profit, the gross profit margin of real estate development and sales in 21 years was 17.7%, a year-on-year decrease of 4.1pct, while the gross profit margin of property rental and management was 72.6%, a year-on-year increase of 1.9pct. The gross profit margin of the company’s commercial operation is significantly higher than that of real estate development and sales, and shows an upward trend.
Sales declined slightly throughout the year, land acquisition tended to be cautious, and the value of land storage was relatively sufficient: in 21 years, the company achieved a contract sales amount of 233.78 billion yuan, a year-on-year increase of – 6.8%, a contract sales area of 23547000 square meters, a year-on-year increase of + 0.3%, and an average sales price of 9928 yuan / square meter, a year-on-year increase of – 7.1%. In the market cooling environment, the company became more cautious in land acquisition. In 21 years, the total construction area of new land reserve was 21.577 million square meters, with a year-on-year increase of – 47.9%. The average floor price was 3555 yuan / square meter, with a year-on-year increase of + 17.3%. Among them, the new land reserve of commercial complex project was 10.286 million square meters, with a year-on-year increase of – 58.5%. By the end of 21 years, the company has a total land reserve of 138 million square meters nationwide, which can meet the needs of development and operation in the next 2-3 years. Among them, the first and second tier cities account for about 37%, the third and fourth tier cities in the Yangtze River Delta account for about 30%, and the third and fourth tier cities in other regions account for about 33%.
The two wheel drive strategy continued to make efforts, and the commercial operation performance was brilliant: in 21 years, the company achieved a tax included rental income of 8.6 billion yuan, a year-on-year increase of + 50.9%, of which the total operating income of 26 Wuyue squares exceeded 100 million yuan. The company has set up 188 Wuyue squares in 135 cities across the country, with 130 in operation and entrusted management. The opening area of Wuyue square is 12.484 million square meters, a year-on-year increase of + 32.8%, and the average rental rate is 97.6%, maintaining a high operation level. We believe that the synergy and complementarity of commercial operation + residential development is the superior business model of the company, which helps the company to go through the cycle and enjoy the operation dividend in the post real estate era.
Multi channel financing helped reduce the cost and steadily entered the green file: in 21 years, the company issued green bonds, low interest dollar bonds and domestic corporate bonds, and the average financing cost fell to 6.57%, down 0.15pct. The three red lines have successfully entered the green level. The 21-year pre estimated asset liability ratio is 69.95%, the net debt ratio is 48.12%, the cash short debt ratio is 1.07, and the financial situation is more healthy. With the completion of the due repayment of 3.195 billion yuan of domestic bonds and the early redemption of US $40.49 million of domestic foreign debts in March, the company’s debt repayment pressure continued to weaken.
The repurchase plan was launched to show confidence in future development: the company announced that it planned to use its own funds to repurchase the company’s shares in the next six months. The total repurchase funds were no less than 100 million yuan and no more than 200 million yuan, the repurchase price was no more than 41.39 yuan / share, and the maximum repurchase quantity was 4832085 shares, accounting for 0.21% of the current total shares.
Investment advice: buy. Although the company’s performance has fluctuated in the past 21 years due to the general trend of the industry, the advantages of the company’s “residential + commercial” dual driven business model are prominent, and the commercial operation is expected to become an important driver of the company’s income growth and gross profit improvement. We estimate that the net profit attributable to the parent company in 22-24 years is RMB 13.3 billion, RMB 13.3 billion and RMB 14.2 billion, and the corresponding EPS is RMB 5.75, RMB 5.89 and RMB 6.30. Considering that the company’s debt repayment pressure is gradually disappearing, the financing channels are unobstructed and has certain advantages in commercial operation, the company is given a 22-year PE valuation of 7 times, the corresponding target price is RMB 40.22, and the “buy” rating is maintained.
Risk tips: the aggravation of the epidemic affects business, the relaxation of policies is less than expected, and the de industrialization of the third and fourth lines is less than expected.
