\u3000\u3 China Vanke Co.Ltd(000002) 352 S.F.Holding Co.Ltd(002352) )
Key investment points
Event: S.F.Holding Co.Ltd(002352) released 2022q1 performance. In the first quarter of 2022, S.F.Holding Co.Ltd(002352) achieved an operating revenue of 62.98 billion yuan, a year-on-year increase of 47.8%; The net profit attributable to the parent company was 1.02 billion yuan, reversing losses year-on-year in 2021q1 and increasing by 12.6% year-on-year in 2020q1; The net profit of deducting non return to parent company was 910 million yuan, which was reversed in 21q1 and increased by 9.6% in 20q1; 22q1 operating cash flow was 4.81 billion yuan, a year-on-year increase of + 485.0%. Continue to focus on the core logistics strategy, and the company’s performance has increased steadily.
The epidemic situation did not change, the products of express transportation business were optimized, the single ticket revenue increased, and Kerry’s consolidated international and supply chain business increased rapidly. The company continued to focus on the core logistics business, and the operation of 22q1 improved significantly. In 22q1, the revenue of express transportation business was 39.59 billion yuan, a year-on-year increase of + 2.7%, the number of pieces was 2.43 billion, a year-on-year increase of – 1.5%, and the revenue of single piece express transportation business was 16.29 yuan, a year-on-year increase of + 4.2%; Affected by the March epidemic, the company’s express business revenue and volume decreased slightly in March. In a single month, from January to March 2022, the company’s express business revenue was 17.28 billion yuan, 9.85 billion yuan and 12.46 billion yuan respectively, with a year-on-year increase of + 14.2%, – 3.4% and – 5.9% respectively. The business volume was 990 million, 640 million and 800 million pieces respectively, with a year-on-year increase of + 10.0%, – 8.3% and – 7.9% respectively. The single express business revenue was 17.47, 15.44 and 15.52 yuan respectively, with a year-on-year increase of + 3.8%, + 5.5% and + 2.2% respectively. Under the influence of Kerry Logistics consolidated statement, the company’s 22q1 supply chain and international business revenue was 20.21 billion yuan, a year-on-year increase of 451.0%. In March 2022 alone, the supply chain and international business revenue was 7.83 billion yuan, a year-on-year increase of + 53.3%.
Product optimization + four networks financing + cost and new business improvement, and the company’s profit continues to improve. The company continued to optimize the product structure, reduce the number of products with low gross profit, refine cost control, improve input-output efficiency, and continuously improve the profit of superimposed new businesses. The company’s comprehensive gross profit in 2022q1 was 7.72 billion yuan, with a year-on-year increase of + 152.9%, a gross profit margin of 12.3%, and a year-on-year increase of + 5.1pp; The net profit was 1.46 billion yuan, and the net interest rate was 2.3%. The loss was reversed year-on-year, down 0.2pp from 20q1; The net profit attributable to the parent company was 1.02 billion yuan, and the net interest rate attributable to the parent company was 1.6%, reversing losses year-on-year, down 1.1pp from 20q1; Deduct the net profit not attributable to the parent company of 910 million yuan, deduct the net interest rate not attributable to the parent company of 1.4%, turn the loss year-on-year, down 1pp compared with 20q1. The company’s expenses were well controlled, and the management expense rate continued to decline. The management expense of 22q1 company was 4.32 billion yuan, a year-on-year increase of + 39.4%, and the management expense rate was 6.9%, a year-on-year decrease of 0.4pp.
A new round of stock option incentives to strengthen confidence in development. The company issued the stock option incentive plan for 2022. There are four exercise periods from 2022 to 2025. The performance assessment objective is based on the operating income or net interest rate attributable to the parent company. The operating income during the exercise period from 2022 to 2025 is required to be no less than 2700, 315, 370 and 435 billion yuan respectively, or the net interest rate attributable to the parent company is no less than 2.1%, 2.6%, 2.9% and 3.3% respectively, so as to continuously enable long-term development.
Profit forecast and investment suggestions. Cost improvement will be the biggest fundamentals of SF in 2022. The improvement of four networks financing and capacity utilization will continue to be realized at the gross profit end, and the annual cost reduction will exceed the 21-year level. At the same time, the optimization space of expenses during this period is underestimated by the market, which also significantly improves the core profit. In the long run, the production of Ezhou airport will inject new momentum into the growth of time-effective parts, and the price increase of e-commerce parts under the guidance of industrial policies will also optimize the profitability of SF Express’s whole product line; Together with Kerry Logistics, it is expected to open a new growth curve of SF international business from the aspects of management team, business collaboration and asset reuse. We believe that the current market value of 230 billion only reflects the value of SF time limited network. There is no reasonable pricing for marginal improved express, intra city and other businesses and call options with high growth of international businesses. We are optimistic about the rise of the company’s long-term business barriers and suggest long-term opportunities brought by short-term shocks such as the epidemic and oil prices. It is estimated that the net profit of S.F.Holding Co.Ltd(002352) attributable to the parent company from 2022 to 2024 will be 6.68 billion yuan, 8.76 billion yuan and 10.44 billion yuan respectively, corresponding to 35, 27 and 22 times of the current PE respectively, maintaining the “buy” rating.
Risk tip: the growth rate of e-commerce consumption decreased, capital expenditure exceeded expectations, and the cultivation of new business was less than expected.
