\u3000\u30006 Guangdong Ganhua Science & Industry Co.Ltd(000576) 00057)
Events
On May 17, 2022, the company announced that it planned to introduce China Merchants Group Co., Ltd. and Shandong Port Group Co., Ltd. as strategic investors through non-public issuance of a shares.
Comments
It is proposed to introduce China Merchants Group and Shandong Port as strategic investors to form complementary advantages. The company plans to introduce China Merchants Group Co., Ltd. (hereinafter referred to as “China Merchants”) and Shandong Port Group Co., Ltd. (hereinafter referred to as “Shandong Port”) as strategic investors and fully combine the advantages of all parties to carry out strategic cooperation in port logistics, supply chain services, trade business, commodity operation business, supply chain financial services, smart logistics, etc. At present, China Merchants Group focuses on China’s coastal areas, with rich port infrastructure resources and a global shipping network; Shandong Port Group is the main operator of ports in Shandong Province. It has advantages in port infrastructure resources and logistics resources. In addition to Xiamen Xiangyu Co.Ltd(600057) years of in-depth expansion in supply chain channels and logistics nodes, this collaborative cooperation is conducive to further strengthen the regional advantages and improve the network layout on the existing basis.
Synergy helps the company continue to be bigger and stronger in the field of bulk supply chain. This cooperation will help all parties to realize resource sharing and achieve mutual benefit and win-win results through synergy. Under the synergistic effect, the company’s original advantageous projects such as the transportation of grain from the north to the South and the transportation of materials from the north to the South will be improved with the enrichment of port resources. In addition, with the embedding of the regional competitiveness of Shandong Port, the company’s business development in Shandong and surrounding radiation areas will be further expanded. For the company, on the one hand, the participation of strategic investors is conducive to the company’s continuous enrichment of commodity categories, expansion of customer scale and horizontal expansion on the basis of vertical and in-depth “whole industry chain service” and in combination with the supply and customer resources of strategic investors; On the other hand, it is conducive for the company to continue to strengthen the logistics service capacity, rely on the original railway centered logistics network, form an integrated connection and linkage with the logistics network of China Merchants and Shandong Port, strengthen the multimodal transport capacity, improve the “highway, railway, water and warehouse” logistics system, and improve the logistics efficiency and customer service capacity.
The funds raised from non-public offering are expected to supplement liquidity. The non-public offering of shares is planned to raise 3.5 billion yuan, including 1 billion yuan subscribed by China Merchants Group, 1 billion yuan subscribed by Shandong Port and 1.5 billion yuan subscribed by Xiangyu Group. After the implementation, the raised funds will be used to supplement working capital and repay debts, which will help improve the company’s capital structure and anti risk ability. At the same time, it is also conducive to the company’s business investment and comprehensively enhance its competitiveness.
Main profit forecast and assumptions: maintain the previous profit forecast and investment rating. We expect the net profit attributable to the parent company from 2022 to 2024 to be RMB 2.571/30.06/3.614 billion and EPS to be RMB 1.19/1.39/1.68 respectively. We will give a 7-fold PE valuation in 2023, maintain the target price of RMB 9.73 and maintain the rating of “better than the market”.
Risk tip: commodity price fluctuation risk, macroeconomic recovery is less than expected, and industrial policies change.
