\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 006 Daqin Railway Co.Ltd(601006) )
Key investment points
The repair of production capacity led the average daily traffic volume of Daqin line to rise to more than 1.25 million tons in March
In March, the average daily traffic volume of Daqin line was 1253900 tons, with a year-on-year increase of 8.0% and a month on month increase of 13.3%. The average daily traffic volume rebounded to more than 12.5 billion tons, with a positive growth in the first month of the year. In the first quarter, the total average daily traffic volume of Daqin line was 1154800 tons, a year-on-year decrease of 3.4%. After excluding the factors of the wrong date of the Spring Festival, the traffic volume is slightly lower than that of the same period last year, mainly due to the production restriction of the safety supervision of the Winter Olympic Games in February and the epidemic situation in some coal mining areas. The follow-up policy of ensuring supply and price stability continues to work, and the traffic volume is expected to continue to improve.
It is estimated that the transportation volume of Daqin line will continue to recover to 430440 million tons in 2022
1) on the supply side, China Railway Group organized railway transportation enterprises to concentrate resources and spare no effort to increase transportation. The railway coal transportation volume increased rapidly, effectively ensuring the stable production and supply of coal.
2) on the demand side, the peak construction season will gradually enter from mid to late March to April, and the top-level design of steady growth series is expected to enter the practical operation stage one after another. The demand for real estate is also marginally warmer under the general tone of stabilizing land price, house price and expectation. In addition, the prevention and control of epidemic situation in Tangshan region in mid to late March also led to the phased shift of automobile transportation and coal to railway transportation. The overall supply and demand is still good. Follow up attention will be paid to the spring repair of Daqin line in April. According to Inner Mongolia Eerduosi Resources Co.Ltd(600295) coal network, the spring repair of Daqin line in 2022 will be postponed to April 18, and the maintenance time will be reduced to 20 days (from April 6 to April 30 in the same period last year). Driven by the reduction of accidental factors and the expectation of infrastructure development, the traffic volume of Daqin line is expected to further recover to 430440 million tons in 2022
The impact of environmental protection policies is slight and the margin is loose, and there is still room for the long-term improvement of the traffic volume of Daqin line
According to China Coal News, on March 5, Xi Jinping General Secretary stressed during the deliberation of the Inner Mongolia delegation that to achieve the “double carbon” goal, we must base on the coal rich national conditions, adhere to seeking progress while maintaining stability, do not step on the “emergency brake”, give consideration to the green environment and production and life, and in the long run, the transportation volume of Daqin line is still supported by “three safety cushions”: 1) the coal source structure is adjusted, and the coal producing area continues to concentrate in the three western regions, Consolidate regional advantages Daqin Railway Co.Ltd(601006) main business moat; 2) The adjustment of transportation structure, the continuous promotion of public rail transit, and the cooperation between the State Railway Group and local governments and enterprises to promote the incremental action of railway freight; 3) The diversion of competitive lines is weak. Compared with the four main lines of West to east coal transportation, the transportation cost advantage of Daqin line still exists. With the centralized coal source, the transfer of bulk transportation to railway and the resonance of low transportation cost, the Daqin line has sufficient guarantee on the demand side.
Absolute amount dividend commitment decoupling profit, under cautious expectation or both absolute and relative returns
According to the dividend return plan of the company from 2020 to 2022, the annual cash dividend per share shall not be less than 0.48 yuan / share. The commitment will be fulfilled in 2020, with a dividend of 4.8 yuan for 10 shares, with a dividend proportion of 65.5%. The dividend income of the company corresponding to the current closing price (2022 / 4 / 7) in 2021 can reach 7.0%, and the bottom absolute income. The company’s prudent allocation based on the steady growth of dividend expectations and stable market value.
Profit forecast and valuation
Assuming that the traffic volume of Datong Qinhuangdao railway increases steadily, without considering the adjustment of freight rate, we expect the net profit attributable to the parent company to be 12.212 billion yuan, 13.526 billion yuan and 13.808 billion yuan respectively from 2021 to 2023. In addition, the company’s current Pb (LF) is only 0.84 times, with sufficient safety margin and deterministic dividend income bottom, maintaining the “overweight” rating.
Risk tip: the demand for coal has dropped sharply; Mass transit railway is difficult to sustain; Volume diversion on competitive lines.
