\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 390 China Railway Group Limited(601390) )
Event:
On the evening of April 7, 2022, China Railway Group Limited(601390) released the announcement of main business data in the first quarter of 2022. The total amount of new contracts signed by 2022q1 company reached 605.74 billion yuan, a year-on-year increase of 84%, realizing a "fast start and a good start".
Comments:
In 2022q1, the total amount of newly signed contracts increased by 84% year-on-year to achieve a "good start", and the infrastructure construction business increased the overall growth rate
In Q1 2022, the total amount of new contracts signed by the company reached 605.74 billion yuan, a year-on-year increase of 84%, realizing "a fast start and a good start". Among them, the newly signed contracts for infrastructure construction, survey, design and consulting services, industrial design and parts manufacturing, real estate sales and other businesses were 543.45 billion yuan, 11.92 billion yuan, 14.92 billion yuan, 7.17 billion yuan and 28.28 billion yuan respectively, with an increase of 94.1%, 157.5%, 5.4%, 28.4% and 38.4% respectively. The newly signed contracts for infrastructure construction accounted for 89.7% of the total newly signed contracts of the company in Q1, and the high growth rate increased the growth rate of the overall newly signed contracts of the company in Q1.
According to the statistics of regional distribution, the newly signed contract amount in China reached 566.16 billion yuan, a year-on-year increase of 81.7%, mainly benefiting from the high growth rate of infrastructure construction, especially highway, municipal and other businesses; The newly signed overseas contracts amounted to 39.58 billion yuan, a year-on-year increase of 123.6%, or related to the liberalization of overseas epidemic control and economic recovery.
In the infrastructure construction sector, the newly signed contracts of municipal and other businesses (including housing construction business) are large in scale, high in proportion and fast in growth. The newly signed contracts amount to 401.66 billion yuan, accounting for 66.3% of the total newly signed contracts of the company in Q1, with a year-on-year growth rate of 108.1%; The newly signed contract amount of highway business reached 84.93 billion yuan, with a year-on-year growth rate of 147.5%, which is the fastest growing in the subdivided field of infrastructure construction business; The newly signed contract amount of railway business was 56.86 billion yuan, an increase of 7.9% at the same time, and the growth rate was relatively flat.
The steady growth of infrastructure has achieved remarkable results, and the follow-up infrastructure investment is expected to continue to increase under the pressure of the epidemic
In Q1 2022, the newly signed contract amount of the company's infrastructure construction business increased by 94.1% year-on-year, about 6 times the average year-on-year growth rate of the business in the past two years. The main reason is that the steady growth policy of infrastructure construction in Q1 2022 began to work, and the "moderately ahead of schedule infrastructure investment" mentioned in the government work report gradually took effect. Superimposed on the low base of newly signed contract amount of infrastructure construction in the same period of last year (21q1 increased by - 7.3%). Among them, the year-on-year growth rate of highway business, municipal and other businesses (including housing construction business) is about 12 times and 6 times of the average year-on-year growth rate of each quarter in the past two years.
The newly signed contract amount of survey, design and consulting services increased by 157.5% year-on-year, ranking first among all businesses, significantly higher than the average quarterly growth rate of the business in the past two years (the average annual growth rate of cumulative quarterly caliber was - 13.0%).
The recent repeated epidemic has a great impact on China's economic growth. It is expected that the follow-up infrastructure investment is expected to continue to increase. As one of the leaders of China's infrastructure and engineering construction, the company is expected to make full profits, and its orders and performance may maintain a high growth rate.
The new land reserve for real estate development was 265000 square meters, a year-on-year increase of 85.3%
In Q1 2022, the company's real estate development business added 265000 square meters of land reserve, a year-on-year increase of 85.3%; The newly started area, completed area and contracted area were 1.437 million square meters, 819000 square meters and 465000 square meters respectively, with an increase of 2.9%, - 40.9% and - 22.6% respectively. The contracted amount of real estate development was 7.17 billion yuan, an increase of - 28.4%.
Maintain the "buy" rating of the company's A-shares and H-shares: China Railway Group Limited(601390) 2022, the total amount of newly signed contracts in Q1 increased by 84% year-on-year, realizing a "fast start and a good start". Among them, the growth rate of infrastructure construction business is fast and accounts for a high proportion, which drives up the growth rate of the company's overall newly signed contracts in Q1, indicating that the steady growth of infrastructure has a significant effect of policy. The recent repeated epidemic has a great impact on China's economic growth. It is expected that the follow-up infrastructure investment is expected to continue to increase. As one of the leaders of China's infrastructure and engineering construction, the company is expected to make full profits, and its orders and performance may maintain a high growth rate. We maintained the company's EPS of 1.25 yuan, 1.39 yuan and 1.57 yuan from 2022 to 2024, and the current price corresponding to the dynamic P / E ratio of a / H shares in 2022 was 5.2x/3.0x respectively. The valuation is still low, maintaining the "buy" rating of A-Shares and H shares.
Risk tip: infrastructure investment is lower than expected, the growth rate of newly signed orders slows down, the collection of orders is lower than expected, and the real estate business is lower than expected.
