\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 325 Huafa Industrial Co.Ltd.Zhuhai(600325) )
Key investment points
From the leading enterprise in Zhuhai to the whole country, the business indicators have made steady progress
The company is a subordinate enterprise of Zhuhai SASAC, with solid shareholder credit endorsement, and is in an absolute leading position in Zhuhai local market. In recent years, the company has continuously improved the “4 + 1” national layout on the basis of continuous deep cultivation in the Yangtze River Delta, Pearl River Delta and Wuhan Urban Agglomeration in Central China. In 2021, the company achieved an operating revenue of 51.241 billion yuan, a year-on-year increase of 0.46%; The net profit was 4.677 billion yuan, a year-on-year increase of 2.56%; The net profit attributable to the parent company was 3.195 billion yuan, a year-on-year increase of 10.09%.
Product oriented, quality oriented, and steady growth in sales performance
The company adheres to the brand strategy of “building a home with Chinese ingenuity” and continues to iterate the product system. The product quality has been praised by all walks of life and achieved a good brand premium. Under the background of cooling down of the industry and market, the company’s sales performance is still stable and progressive. The sales volume of the company in 2021 was 121.89 billion yuan, with a year-on-year increase of 1.2%, ranking 32nd in the sales list of Chinese real estate enterprises of Kerui in 2021, up 2 places from 2020.
Soil storage focuses on the first and second lines and expands its territory through diversified cooperation
By the end of 2021, the company had a total soil storage of 5.4397 million square meters; The area under construction is 15.42 million square meters, of which the first and second tier cities account for about 85%. Relevant resources are highly concentrated in cities with outstanding market value and long-term development potential. In addition, the company actively innovates the land acquisition mode, obtains high-quality projects and expands its business territory through diversified expansion methods such as cooperation, acquisition and merger, urban renewal and so on.
The financial structure was continuously optimized, and the “three red lines” turned green in an all-round way
In 2021, the company achieved the goal of debt reduction and deleveraging within one year by comprehensively accelerating the collection of funds, optimizing the financing structure and controlling the pace of investment and expansion, and fully realized the transformation from “three red lines” to green. Among them, the scale of interest bearing debt decreased steadily, with a year-on-year decrease of 10%; The structure of interest bearing debt was significantly optimized, and short-term debt decreased by about 40%. The credit rating of the main body of the company by authoritative institutions remains “AAA”, and the outlook is stable.
Profit forecast and valuation
Considering the high quality of the company’s products, the focus of soil storage on high-energy cities and the stability brought by the background of state-owned assets, we expect the net profit attributable to the parent company in 20222024 to be RMB 3.64 billion, 3.93 billion and 4.21 billion respectively, corresponding to EPS of RMB 172, 1.86 and 1.99. With reference to the valuation of comparable companies, the company is given a PE valuation of 7 times in 2022, corresponding to the target price of 12.05 yuan, and is given a “buy” rating for the first time.
Risk tips
Diversified ways of increasing reserves are less than expected; The repair demand is less than expected; The policy improvement is not as good as expected.
