The central enterprise literature travel leader, the shareholder background is strong, the staff motivation is sufficient. The largest shareholder of the company is overseas Chinese Town Group, and the actual controller is SASAC of the State Council. The group has injected overseas Chinese Town real estate equity, Shenzhen Nanshan land and other assets into overseas Chinese Town to empower listed companies. The company conducted equity incentives in 2015 and repurchased a total of 160 million shares in 2020-2021, accounting for 2% of the company's total share capital, which will be used to implement the company's equity incentive plan.
The culture and travel business leads the industry and is expected to grow. The company ranks third in the theme park group in the world. At present, it has 27 scenic spots, 28 hotels, 1 travel agency, 7 open tourism areas and 1 tourism performing arts project. It received 77.98 million tourists in 2021, returning to 150.2% in 2019. Excluding new projects, it returned to 96.3% in 2019, far exceeding the national tourism average, of which the new projects contributed 36% of the passenger flow. The company expects to open 10 more projects in 2022, which will provide a strong support for future development.
The real estate business is making progress steadily, strengthening fine management and focusing on comprehensive development into pieces. In 2021, the company achieved contracted sales of 82.5 billion yuan, down 21.6% from the same period last year, achieved contracted sales area of 3.99 million square meters, down 14.2% from the same period last year, achieved a rebate amount of 91.2 billion yuan, a payback rate of 111%, and achieved fruitful results in strictly grasping the payback during the downward period of the industry. The company has the advantages of comprehensive development and rich cultural and travel resources, and can obtain a large number of low-cost land at the rock bottom price through the literature and tourism application mode, and the number of land acquired at the rock bottom price has been more than 60% since 2019. It forms a strong support for the profit margin of the company's future real estate business sector.
For the first time, the buy rating is given, with a target price of 11.98 yuan. We estimate that the EPS of the company in 2022 to 2024 is 0.54, 0.60, 0.63 respectively. In terms of valuation, according to the average price-to-earnings ratio of the comparable company in 2022, its reasonable market capitalization should be 98.2 billion yuan, corresponding to the share price of 11.98 yuan, covered for the first time and given a buy rating.
Risk hint: real estate sales continue to decline, affected by the epidemic, cultural travel business growth pressure, the number of new opening projects is less than expected.