\u3000\u3 China Vanke Co.Ltd(000002) 120 Yunda Holding Co.Ltd(002120) )
Key investment points
Has the logic of profit restoration changed? The profit recovery remains unchanged and the value continues to rise
1. The logic of profit restoration remains unchanged: the essence of profit restoration comes from three factors: volume increase, price increase and cost reduction. From the three factors, the certainty of profit restoration is strong: 1) in terms of single quantity, the single quantity in the first April under the influence of the epidemic still increased by 9%, and the single quantity in the first February without the influence of the epidemic increased by 31% year-on-year; 2) In terms of price, the prices in Yiwu, Guangzhou, Shenzhen and other grain producing areas returned to benign and continued to rise; 3) In terms of cost, driven by the improvement of scale effect and production demand matching, the trunk line cost and transit cost are still in a downward trend. The general trend of profit recovery remains unchanged.
2. The performance of the first quarter report is too pessimistic: the market is too pessimistic about the performance of the first quarter report Yunda Holding Co.Ltd(002120) in the first quarter, the net profit not attributable to the parent company deducted from a single ticket was about 0.09 yuan, a decrease of 0.04 yuan month on month compared with 2021q4. According to our analysis, from the perspective of price cost, the change in the basic price of 22q1 was relatively small compared with that of 21q4, but the decrease in seasonal orders brought about an increase in the cost month on month, resulting in the decline of single ticket profit, which was in line with the logic of seasonal profit and did not change the trend of repairing the annual performance.
3. There is room for excess improvement at the expense side of the statement: due to historical financial policies and other reasons, Yunda Holding Co.Ltd(002120) single note financial expenses and credit impairment are relatively high compared with the industry. In the later stage, with the promotion of equity financing methods such as convertible bonds, single note financial expenses are expected to be improved in excess.
How much does the epidemic affect the value of the company? The epidemic is a one-time profit and loss, and the short-term factors do not change the value of the company. The actual profit level: the epidemic mainly affects the single quantity, and the single profit is not directly affected by the epidemic. We assume that the epidemic will affect June. Based on the normal situation, the single volume will increase by 25% year-on-year and the net profit of single ticket to the parent company will be 0.13 yuan, the impact of the epidemic on the annual profit may be only 180 million yuan.
Company value: we believe that the impact of the epidemic is a non recurring factor, and the profit impact brought by the epidemic can be attributed to one-time profit and loss, which does not affect the essence of the recovery of the company's value.
Can the single volume and share still increase? Excluding the impact of the epidemic, the share is still increasing, and the single quantity is increasing. In the short term, the single quantity is affected by the epidemic in mid March, and the single quantity and share of Yunda are affected by the epidemic in Shanxi again in April. However, we believe that on the one hand, the impact of the epidemic is a short-term factor and does not change the medium and long-term pattern. On the other hand, according to the throughput index of distribution centers of major express enterprises and the daily dispatch data of the State Post Office, The single volume is in a rising trend in the short term.
Medium and long term: from the perspective of upstream driving, single package value and market clearing, the single volume of the company is expected to continue to increase. 1) The rise of third-party platforms with goods, such as Tiktok Kwai, is expected to bring a strong new drive to the upstream; 2) We track and judge that the value of single package continues to decline, which will lead to the excess growth of packages relative to physical online shopping Gmv; 3) Tail express continued to clear, superimposed on the impact of industry mergers and acquisitions, and the head share increased, which is expected to lead to a high increase in the company's single volume.
What is the trend of price recovery? The annual average price shows a rising trend. This year, we will focus on Guangdong
Annual prices continued to rise: driven by policy, Yiwu took the lead in recovering prices in the second half of 2021, driving the industry's prices higher. We believe that this year we will focus on the prices in Guangzhou and Shenzhen. The express market management measures (Revised Draft) emphasizes that "we shall not collude with others to manipulate market prices and damage the legitimate rights and interests of other enterprises or users engaged in express business", which is expected to bring about a sustained rise in prices. In the off-season, the price is still strong: after the peak season of double 11 and the Spring Festival in previous years, the unit price fell in March and April. The price is still strong in March and April this year, and the price is expected to pick up more than expected.
Is there any downside to the current cost? In the short, medium and long term, the cost is still on the downward trend
In the short and medium term: we analyze the scale effect + vehicle replacement + distribution center replacement, which will bring down the transportation cost and transit cost. The company's transfer related costs (including transportation costs) for a single ticket in 2021 were 0.82 yuan, a year-on-year decrease of 6.8%, and a compound decrease of 12.0% from 2017 to 2021.
In the medium and long term, the annual peak and valley of single volume are flattened, and the matching degree of production and demand is improved, which is helpful to reduce cost and increase efficiency. With the allocation from the peak season of e-commerce to the off-season, the annual unit volume tends to be flat in the off-season and peak season, while the production capacity investment slows down, which improves the matching degree of production and demand, and enters the trend of cost reduction and efficiency increase in the medium and long term.
Profit forecast and Valuation: the profit is greatly repaired, the valuation is low, and the "buy" rating is emphasized
We expect the net profit attributable to the parent company from 2022 to 2024 to be RMB 2.614 billion, RMB 3.927 billion and RMB 4.829 billion respectively, with a year-on-year increase of 77.0%, 50.3% and 23.0% respectively, and a compound increase of 48.4% compared with that in 2021. The current share price is only 12.2 times and 2029.2 times respectively. As a leader in the A-share e-commerce express industry, the company has eliminated the one-time influencing factors of the epidemic and continued to repair its profits. The logic of eliminating the risk of e-commerce express price war first proposed by US continues. The single volume drive is still in progress, the price rises and the cost goes down, resulting in continued high performance growth and undervalued value. We emphasize the "buy" rating again.
Risk tips:
Capital expenditure exceeded expectations; The damage of the epidemic to the express network exceeded expectations; The growth of upstream online shopping consumption was lower than expected.
