Volume and prices increased steadily in the first quarter, and revenue growth exceeded expectations. 22Q1 achieved revenue of $1.034 billion, up 65.4% year-on-year and 6.1% month-on-month over 21Q4. Of this total, container shipping logistics revenue was US $1.027 billion, up 66.0% from the same period last year, up 6.2% from the previous month, and dry bulk revenue was US $6.6 million, up 6.5% from the same period last year and down 7.0% from the previous month. Business volume: Q1 completed container traffic of 7.03 million TEU, an increase of 4.8% over the same period last year and a decrease of 18.3% from the previous month. Freight: the average container freight of Q1 company is 1241.6 US dollars / TEU, an increase of 61.6% over the same period last year and 29.4% month-on-month.
In the first quarter, intra-regional trade in Asia was active, and container traffic grew steadily, supporting the operation of high freight rates.
On the Chinese side, China's imports and exports to the other 14 members of the RCEP reached 2.86 trillion yuan in the first quarter, an increase of 6.9 percent over the same period last year, of which exports totaled 1.38 trillion yuan, up 11.1 percent, and imports reached 1.48 trillion yuan, up 3.2 percent. From a country-specific point of view, imports and exports between China and South Korea, Malaysia, New Zealand and other countries exceeded double-digit year-on-year growth in the first quarter; in Southeast Asia, Vietnam's imports and exports in the first quarter were US $176 billion, up 14.4 percent over the same period last year; Malaysia's total trade volume increased by 22.9 percent in the first four months compared with the same period last year; and Thailand's total trade with RCEP member countries increased by 23 percent in the first quarter. Better demand for internal trade to support the high operation of freight rates.
In the medium to long term, regional trade demand in Asia continues to release, while supply is under pressure and freight rates are supported. On the demand side, the RCEP agreement came into effect at the beginning of 22 years, and the intra-regional trade volume is expected to continue to grow. Drury expects the global port throughput to grow by 4.6% in 22 years. On the supply side, the capacity of the container fleet is expected to be lower than the growth rate of demand, and the annual assessment of its carbon emission index to be implemented by the International Maritime Organization will gradually scrap the spread of obsolescence and restrain the growth of container transport capacity. the above factors will maintain the supply and demand balance of the company's container shipping logistics in Asia. And the company has entered a relatively concentrated delivery period, capacity expansion leading competitors, is expected to continue to benefit from the high prosperity of the industry.
Based on the fact that the company's performance in 2021 exceeded its original forecast and the freight rate for 22 years was further higher, we adjusted the company's earnings per share to 3.91 RMB per share in 2023 (from the original forecast of RMB 1.24 and RMB 1.53 per share for 23 years, respectively), and added the 24-year profit forecast to estimate earnings per share of RMB 2.51. Refer to the comparable company's adjusted average valuation level of 9 times in 2022, corresponding to the target price of RMB35.18, which translates to HK $41.15 according to HK $0.855, maintaining the buy rating.
Risk hint
Excessive competition in the industry led to a decline in freight rates, regional economic and trade recession led to a decline in freight volume, and a sharp rise in fuel prices increased voyage costs.