This report is read as follows:
The company's performance is in line with expectations, waiting for the restructuring of duty-free business to continue.
Main points of investment:
Investment suggestion: we maintain the company's return net profit from 2021 to 2022 is 7.89 yuan and 874 million yuan respectively, and add 980 million yuan in 2023. Due to the company's repurchase of cancelled shares, the corresponding EPS is 0.41, 0.45 and 0.03, respectively. Although the restructuring of tax-free assets is currently suspended, considering the expectation of a restart and giving a certain valuation premium, the company's 2022 30xPE raised its target price to 13.5 (+ 4) yuan. Maintain the overweight rating.
Performance summary: the company's performance is in line with expectations. The 2021H1 income of the company is 3.391 billion yuan / + 13.86%, and the net profit is 469 million yuan / + 11.15%. Gross margin 37.4%/+3pct, sales expense rate 2.82%/+0.24pct, management expense rate 2.43%/+0.42pct.
The restructuring of duty-free business is expected to continue to advance. The reorganization of duty-free assets was suspended on February 10, 2021, and the Pearl exemption Group was invited to participate in the Hainan Consumer Expo in May 2021, during which Gree Real Estate and the chairman of the Pearl Free Group was interviewed by the 21st Century Economic Report. we expect the company's tax-free business to continue to move forward.
Further layout of the Hainan project. ① August 28, Zhuhai duty-free group and Sanya Luwen group joint venture operation of Zhuhai duty-free Sanya travel investment mall opened, operating area of nearly 3000 square meters, shopping, cross-border e-commerce and residents into the border consumption business. ② Company spent 1.651 billion yuan to acquire about 49.4 mu of land in Sanya headquarters economy and Central Business District. Sanya Phoenix Coastal Land is intended to be used for the construction of coastal high-end tourism retail business projects to help build an international tourism consumption center to further develop the large consumer industry. At present, the project construction is being carried out in an orderly manner.
Risk hints: macroeconomic fluctuations affect tourism demand; Hainan tax exemption policy liberalization is lower than expected; the competition pattern of duty-free industry has changed; the risk of companies failed to acquire tax-free assets.