\u3000\u30 Shenzhen Fountain Corporation(000005) 67 Hainan Haide Capital Management Co.Ltd(000567) )
Event: the company disclosed its 2021 annual report, realizing an operating revenue of 670 million yuan (YoY + 114%), a net profit attributable to the parent company of 380 million yuan (YoY + 200%), and an earnings per share of 0.60 yuan (YoY + 200%). In 2021, the company achieved a weighted average return on net assets of 8.43% (YoY + 5.45pct.). In addition, the company disclosed that in the first quarter report of 2022, the performance also maintained a high growth trend. The company realized an operating revenue of 200 million yuan (YoY + 172%), a net profit attributable to the parent of 130 million yuan (YoY + 165%), and a basic earnings per share of 0.20 yuan (YoY + 165%). In 2022q1, the company achieved a weighted average return on net assets of 2.65% (YoY + 1.55pct).
The company’s performance is growing rapidly, and the reorganization of business meets the development opportunities. 1) The business layout and structure were adjusted, and the reorganization class maintained a high growth trend. Benefiting from the environment of increasing macroeconomic downward pressure, the overall oversupply of non-performing assets in the market has become increasingly prominent, and the company’s restructuring business has ushered in rapid development. By the end of 2021, the company had 25.264 billion yuan of assets under management. 2) The debt crisis of controlling shareholders has been effectively resolved, and the healthy development has been achieved with light equipment. At the end of 2021, Yongtai group, the controlling shareholder of the company, resolved the debt crisis through the restructuring plan, and the strategic focus of Hyde asset management business returned to the right track of development. 3) The leverage ratio is low, and there is significant room for the development of non-performing business. By the end of 2021, the company’s leverage was about 0.4 times (interest bearing liabilities / net assets), significantly lower than the business leverage of AMC general asset management company, which was 5-6 times. The credit risk exposure was small, and the business scale had significant room to improve.
The industry has huge development space and broad market prospects. 1) The scale of non-performing assets is huge, and the pattern of oversupply continues. According to the disclosure of regulatory agencies such as the China Banking and Insurance Regulatory Commission, China’s stock of non-performing assets is expected to reach 6 trillion yuan. If considering the volume of non-performing assets such as financial distress and non disposal, the overall scale is expected to reach 10 trillion yuan. Therefore, considering the impact of the epidemic on the real economy, the trend of oversupply in the overall bad market is expected to continue further. 2) AMC institutions are expected to benefit from the bottom clearing of real estate projects. With the marginal relaxation of real estate policy, high-quality real estate enterprises and AMC institutions to deal with non-performing real estate projects has become the development trend of the industry. AMC institutions are expected to benefit from the bottom clearing of some private enterprise projects. 3) Bad industries help the recovery of the real economy. At present, the downward pressure on China’s real economy has increased significantly, the financial statements of commercial banks have increased, and some industries are facing restructuring. The development of non-performing industries will help revitalize enterprise assets, defuse financial risks, promote the adjustment of industrial structure, and then improve the real economy.
With scarce license resources, industrial advantages have gradually emerged. 1) The industrial background promotes the development of asset management business. Relying on the industrial background advantages of controlling shareholders such as energy and real estate, the industrial advantages and asset management business complement each other, so as to effectively integrate industrial resources, identify risks and revitalize non-performing assets. 2) Hold scarce AMC licenses and accelerate the layout of markets inside and outside Hainan Province. As the only A-share licensed enterprise mainly engaged in AMC business, the company has actively arranged its business inside and outside Hainan Province. By 2021, the revenue contribution of Hainan province accounted for 2.69% and that outside Hainan province accounted for 97.31%. 3) The market-oriented mechanism is flexible. Relying on the mechanism advantages of listed companies, the company’s salary management system and long-term incentive mechanism have been continuously improved to promote the expansion of the company’s business scale.
Maintain the “buy” rating. We are optimistic that the company holds scarce licenses and accelerates the Nuggets non-performing business market. The industrial advantages will gradually appear. The company’s low leverage superimposed market supply will increase, which is expected to maintain a high increase in the scale of the company’s non-performing asset management. We expect that the company’s earnings per share from 2022 to 2024 will be 0.89 yuan, 1.03 yuan and 1.20 yuan respectively, with a target price of 19.5 yuan, corresponding to 22×2022 PE.
Risk tip: the resolution of shareholder debt risk is less than expected, the policy is stricter, and the industry competition is increased
