\u3000\u3 Shengda Resources Co.Ltd(000603) 871 Jiayou International Logistics Co.Ltd(603871) )
Event:
1) Jiayou International Logistics Co.Ltd(603871) released the annual report for 21 years, realizing an operating revenue of 3.888 billion yuan, a year-on-year increase of 18.50%; The net profit attributable to the parent company was 343 million yuan, a year-on-year decrease of 4.83%; The net profit deducted from non parent company was 330 million yuan, a year-on-year decrease of 3.40%.
2) the company released the first quarterly report of 22 years, realizing an operating revenue of 650 million yuan, with a year-on-year increase of 8.43%; The net profit attributable to the parent company was 108 million yuan, a year-on-year increase of 28.59%; The net profit deducted from non parent company was 105 million yuan, with a year-on-year increase of 26.71%.
The financial performance in the year of 21 was lower than expected, and the profit and gross profit margin declined, mainly due to the impact of the epidemic in the the Belt and Road countries. From the perspective of business, the growth point of the company’s revenue in the past 21 years came from the PPP project. In the past, there was a relatively obvious decline in its main business. Among them, the supply chain trade achieved an operating revenue of 1.938 billion yuan, a year-on-year decline of 10.12%, and the cross-border multimodal transport business achieved an operating revenue of 1.204 billion yuan, a year-on-year increase of 7.19%. The main reason for the lower growth of the transportation business than expected was that it was affected by the epidemic in the the Belt and Road countries. At the level of gross profit, the company’s supply chain trade business benefited from the improvement of the company’s service scope and the high boom of coal demand. The gross profit margin increased significantly to 9.03%, while the gross profit margin of cross-border multimodal transport business fell sharply to 26.01%. We believe that it is due to the poor customs clearance between China and Mongolia and the decline in the proportion of the company’s high gross profit customs supervised warehouse business.
Over the past 22 years, the African highway project has started trial operation, which has helped the company’s performance growth. The modernization and reconstruction project of the company’s African project Kasumbalesa sakanya road and dry port is progressing smoothly. In January, the construction of the road has been completed, the whole line has been opened to traffic, and it has officially turned into the charging trial operation stage. At the same time, the upgrading and reconstruction project of sakanya dry port and mocambo border port is being actively promoted. The total investment of the project is 230 million US dollars. According to the calculation of the company, the payback period of the project is only 5.44 years. Calculated at the exchange rate of 6.5 US dollars to RMB, it can bring about 274 million annual incremental profits to the company.
The profit increased rapidly in the first quarter of 22 years, and it is more expected if the customs clearance efficiency can be continuously improved in the peak season. In the first quarter, the company recorded an excellent performance of gross profit margin of 23.03% and net profit margin of 16.60%, which is the best level in 17 years. We think there are two reasons behind it. First, the company benefited from the improvement of customs clearance efficiency and the growth of business volume; Second, the proportion of Chinese mine logistics companies has increased in the whole process since 21 years.
Investment suggestion: with the gradual implementation of the company’s African projects, the company’s growth trend is obvious, and the company’s supply chain trade business with low gross profit in the past has successfully become a new growth point of the company’s profit due to the improvement of the proportion of whole process logistics services and the high boom of coal. With the advent of q2-q3 Mongolia mining peak season, if the customs clearance efficiency continues to improve, the company’s performance level is expected to grow steadily. Considering that China is still affected by the epidemic, the company adjusted its profit from 2022 to 2023 to 442 / 633 million yuan (the previous value was 511 / 719 million yuan), introduced the profit forecast of 709 million yuan in 2024, corresponding to the PE valuation of 13.45/9.39/8.38x, and maintained the buy rating.
Risk tip: the epidemic repeatedly exceeded expectations, the company’s cash flow deteriorated beyond expectations, and the overseas regime was unstable
