\u3000\u3 China Vanke Co.Ltd(000002) 858 Shanghai Lisheng Racing Co.Ltd(002858) )
[key points of investment]
The company issued the annual report of 2021. In 2021, the company achieved a revenue of 281 million yuan, a year-on-year increase of 40.4%; The net profit attributable to the parent company was 3.1383 million yuan, compared with – 50.982 million yuan in the same period last year. The epidemic situation was controlled and the company’s traditional business recovered. In 2021, the company’s overall gross profit margin reached 30.5%, with a year-on-year increase of 12.1%, mainly due to the growth of event business. In terms of expenses, the company’s sales expense rate, R & D expense rate and management expense rate in 2021 were 7.9%, 13.6% and 5.1% respectively, unchanged from the level of previous years.
The recovery of the epidemic boosted traditional business. With the recovery of the epidemic in 2021, the company’s two main businesses of sports event operation and stadium operation achieved revenue of 110 million yuan and 652277 million yuan respectively, with a year-on-year increase of 53.9% and 38.4%. In terms of sports event business, in 2021, the company added three event IPS to continuously enrich the existing event IP system; During the reporting period, the events were carried out normally, and only a small number of events were affected by the epidemic. In terms of the operation of stadiums and gymnasiums, the company added three go karts, the company continued to upgrade its service and facility system, and the revenue of individual consumer customers increased significantly.
Equity participation in “pleasing the world” and layout of national fitness. In December 2021, the company participated in “Yuedong world” and carried out business with the “Yuedong circle” app as the carrier and the “2g2c” low-cost customer acquisition mode. “Joy circle” cooperates with local governments on the b-end and g-end to provide sports big data, event organization, intelligent hardware and other services in schools and other institutions; On the C-end, it brings incentives to users through a variety of services such as point exchange, sports banking and online events, and explores and arranges national fitness in all aspects through diversified business models.
The sports industry follows the east wind of the policy. In July 2021, the State Council issued the national fitness plan (20212025), and in November, the General Administration of sports issued the 14th five year plan for sports development. The sports industry is the key support direction of China and has a number of policy support. At the summary and commendation meeting of the Winter Olympic Games and the winter Paralympic Games on April 8, 2022, General Secretary Xi also proposed to further pay attention to China’s sports cause, promote sports reform and innovation, and strengthen sports science and technology research and development with the goal of strengthening people’s physique and improving the physical quality and quality of life of the whole nation. We believe that the recovery of the sports industry is the general trend, and the company’s traditional racing industry chain business and national fitness business will benefit.
[investment suggestions]
We are optimistic that 1) with the recovery of the epidemic, the company’s traditional business will gradually return to the pre epidemic level; 2) With the rapid growth of new businesses under “Yuedong circle”, the company’s performance in 2021 is in line with expectations. We maintain the company’s previous 20222023 and add a new profit forecast for 2024. We predict that in 202224, the company’s revenue will be 421 / 615 / 707 million yuan, the net profit attributable to the parent company will be 33 / 65 / 78 million yuan, and EPS will be 0.01 billion yuan 20 / 0.41/0/49 yuan per share, PE corresponding to 60 / 30 / 25 times, maintaining the “overweight” rating.
[risk tips]
The epidemic repeatedly affected the normal development of traditional business
New business performance is less than expected
