\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 668 China State Construction Engineering Corporation Limited(601668) )
The revenue performance maintained rapid growth, exceeding expectations, and the dividend rate increased for three consecutive years. In 2021, the company achieved an operating revenue of 1891.3 billion yuan, a year-on-year increase of 17.1%; The net profit attributable to the parent company was 51.4 billion yuan, a year-on-year increase of 14.4%, and the net profit excluding non attributable to the parent company increased by 16.0%. The overall performance was slightly higher than expected. Quarterly, Q1 / Q2 / Q3 / Q4 achieved revenue of 404.7 billion yuan, 532 billion yuan, 400.3 billion yuan and 554.3 billion yuan respectively, with an increase of 53.4% / 14.6% / 15.1% / 2.9% (compared with the compound growth rate of 19 years, 16.6% / 17.1% / 17.9% / 11.5% respectively); The net profit attributable to the parent company was 11 / 146 / 122 / 13.6 billion yuan, an increase of 45.5% / 19.2% / 7.9% / – 1.7% (11.5% / 13.0% / 12.3% / 6.8% respectively compared with the compound growth rate of 19 years). The slowdown in performance in the fourth quarter was mainly due to changes in the environment of the real estate industry, the slowdown in revenue growth and the increase in impairment provision. The business objectives for 2022 are: the newly signed contract amount exceeds 3.85 trillion yuan, an actual increase of 9% compared with that in 21 years, and the operating revenue exceeds 2.01 trillion yuan, an increase of 6.3%. In terms of dividends, the company plans to pay 2.5 yuan for every 10 shares, with a total dividend of about 10.49 billion yuan, an increase of 16.4%, and the dividend rate is 20.4%, an increase of 0.4 PCT compared with last year. It has increased for three consecutive years, and the current dividend rate is 4.1%.
The profits of real estate construction and infrastructure construction increased strongly, while the real estate income increased sharply and the profits decreased slightly. In terms of business, the company’s real estate construction / Infrastructure / real estate business achieved revenue of 11471 / 4100 / 330.9 billion yuan respectively in 2021, an increase of 14.6% / 17.7% / 22.0% at the same time; The gross profit was 89.7/428/69.7 billion yuan, an increase of + 33.2% / + 45.1% / – 2.0%. In the field of housing construction, the company continued to consolidate its leading position in the medium and high-end housing construction market, won many batches of key projects in the fields of super high-rise buildings, industrial plants, educational facilities and medical facilities, accelerated the digital transformation, promoted the development of green construction and intelligent construction, significantly increased the gross profit margin of the sector and strong profit growth. In the field of infrastructure, we continued to optimize the transformation of business structure and significantly improved the profitability of the sector. The real estate business adheres to the steady operation strategy. Affected by factors such as real estate regulation and rising settlement land costs, the gross profit margin has decreased, so the profit has declined slightly.
Gross profit margin increased significantly, operating indicators improved, and roe increased to 16.0%. In terms of profitability, the company’s gross profit margin in 2021 was 11.33%, yoy + 0.50 PCT, of which the gross profit margin of real estate construction / Infrastructure / real estate business was yoy + 1.1 / + 1.9 / – 5.1 PCT. Benefiting from the transformation and upgrading of the business structure of the sector, the gross profit margin of real estate construction and infrastructure business increased significantly, driving the overall gross profit margin to improve significantly year-on-year under the influence of real estate drag. During the period, the expense rate was 4.85%, yoy + 0.65 PCT, of which the sales / management / R & D / financial expense rate was yoy-0.02 / + 0.03 / + 0.53 / + 0.11 PCT, and the R & D expense rate increased significantly, mainly due to the company’s increased R & D investment in major engineering construction equipment, assembled / Bim and other core technologies; The increase of financial expense rate is mainly due to the increase of capital demand caused by the expansion of the company’s business scale and the increase of interest expenses. The impairment loss of assets (including credit) is about 9 billion yuan, and the new provision is expected to be mainly the bad debt provision of a real estate customer. The investment income decreased by 1.4 billion yuan, mainly due to the decrease in the investment income recognized by long-term equity investment. The proportion of minority shareholders’ equity decreased by 2.79 PCT. The net interest rate attributable to the parent company is 2.72%, yoy-0.06 PCT. In terms of collection and operating capacity, the company’s net cash inflow from operating activities in 2021 was 14.4 billion yuan, a decrease of 5.9 billion yuan compared with the same period last year, mainly due to: 1) increased investment in real estate development in this period. 2) The price of raw materials has risen, the company has increased its material reserves, and the cost expenditure has increased. The cash to cash ratio and cash to pay ratio are 107% / 109% and yoy + 0 / + 2 PCT respectively. The inventory turnover rate / accounts receivable turnover rate were 2.4/11.1 times, yoy + 0.1 / + 0.8 times, the total asset turnover rate increased by 0.06 times to 0.83 times, driving the average roe to increase by 0.4 PCT to 16.0%, and the profit quality continued to improve.
Leading the new development model of the real estate industry, the two major businesses of real estate and construction are expected to be revalued. The current policy supports and guides the real estate industry to actively explore new development models, and the industry is expected to enter a virtuous circle and a new stage of healthy development in the future. We understand that the new development model is mainly as follows: the development model has changed from “fast turnover and high leverage” to “competitive quality”; The supply mode adheres to the simultaneous development of rent and purchase, speeds up the construction of affordable housing, and pays attention to the stock operation; The financing mode is diversified financing, maintaining a healthy financial structure and avoiding high leverage. The company is a leader in leading the new development model of the real estate industry, and the two major businesses of real estate and construction are expected to be revalued: 1) the profitability of CNOOC real estate, the main platform of the real estate business, has remained first-class in the industry for a long time, the financial indicators have always been stable and prudent, the leverage ratio and financing cost are the lowest range in the industry, and the asset quality is excellent, In the period when most enterprises generally adopt “fast turnover and high leverage”, they have been leading the industry to explore new development models, and their competitive advantage is expected to continue to expand in the future. As a leading central enterprise, the supply side reform of the beneficiary industry is accelerated, the market share is expected to continue to increase, and the value is expected to be revalued. Assuming that the company’s construction business is valued at 22pe5x, the current market value implies that the 22pe of CNOOC real estate is only 4x, which is significantly lower than that of other central enterprises ( China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) pe11x, Poly Developments And Holdings Group Co.Ltd(600048) pe7x). There is a huge space for repair. 2) The infrastructure attribute of the construction business is expected to be continuously enhanced. Under the new development mode, the affordable housing business is expected to grow rapidly, the payment collection risk of residential business is expected to be significantly reduced, the proportion of industrial parks, municipal, medical and other government projects is increased, and the business structure is continuously optimized. In the future, the profitability of the company’s construction business is expected to be continuously improved, the payment collection risk is expected to be significantly reduced, the operation quality will be significantly improved, and the valuation is expected to be close to infrastructure enterprises. The current share price of the company corresponds to 4.5X PE in 22 years and 7.5x PE in China Communications Construction Company Limited(601800) 22 years for infrastructure central enterprises. There is a large repair space in comparison.
Investment suggestion: we predict that the net profit attributable to the parent company in 22-24 years will be 56.1/618/68 billion yuan respectively, with a year-on-year increase of 9% / 10% / 10%, EPS will be 1.34/1.47/1.62 yuan / share respectively, and the corresponding PE of the current stock price will be 4.5/4.1/3.7 times respectively, maintaining the “buy” rating.
Risk warning: some real estate enterprises have credit risk impact and regulatory policy change risk.
