\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 888 China Tourism Group Duty Free Corporation Limited(601888) )
There is still room for the recovery of passenger flow in Hainan, and the risk of diversion should be viewed rationally. The passenger flow of Sanya and Haikou airports has only recovered to the level of 70-80% before the epidemic. Considering the coordinated enhancement of drainage capacity by the business types of outlying islands and Hainan’s natural resource endowment, we believe that there is still 30% – 40% room for the recovery of passenger flow in Hainan. According to the passenger flow classification and analysis in the previous report China Tourism Group Duty Free Corporation Limited(601888) ‘s overall view, scale effect and flexibility, we believe that there is no need to worry too much about the diversion problem before the passenger flow in Hainan returns to the same period in 2019.
The scale effect of tax exemption on outlying islands is significant, and the long-term profitability is expected to continue to improve. From the perspective of stores, the expense side is mainly composed of labor and depreciation, which has significant rigidity. Then, with the recovery of passenger flow and the further improvement of passenger unit price, the profitability of stores is expected to continue to improve. From the perspective of the group, the new harbor duty-free city is expected to reduce the headquarters expense rate and improve the overall profitability of the group in addition to the revenue and profit of the single store.
The valuation is at a historical low, and the left side of the layout is recommended. 1. In February, the operation of the group was satisfactory, with revenue and profit increased by 20% year-on-year. Due to the repeated impact of local epidemic, the performance in March is expected to be slightly under pressure. We believe that the current valuation adjustment is sufficient, the epidemic expectation has been fully entered, and the valuation is expected to enter an upward track. Under the neutral assumption, we expect the net profit attributable to the parent company of the group to be 10.9 billion yuan, corresponding to pe3.0 billion yuan 3X； Under the extremely pessimistic scenario, even if the annual performance is seriously affected by the epidemic, we expect the net profit attributable to the parent company of the group to be 7.2 billion yuan, which can be used as the bottom line of profit under the extreme assumption. We believe that the profit range with reference value is 9.2 ~ 11 billion yuan, corresponding to pe3.0 billion yuan 5~36.4X。
Investment suggestion: the repeated epidemic has blocked the passenger flow in Hainan, and then the epidemic eased and the passenger flow in Hainan resumed. With the superposition of the rigid characteristics of the fee of the tax-free industry in outlying islands, the profit end of the China tax exemption is expected to continue to grow; The landing of new harbor is expected to lead the company out of the second growth curve. We expect that the group will realize a net profit attributable to the parent company of 9.59/109.8/15.59 billion yuan in 2021, 2022 and 2023, respectively, corresponding to pe44.9 billion yuan 7/30.5/21.5X。
Risk warning: the tax-free sales of outlying islands are less than the expected risk; The recovery of international passenger flow is less than the expected risk; Local epidemic recurrence risk; The risk of intensified competition on the island.
