Main points of investment
The cumulative order of the company's 22Q1-3 was 7.77 billion yuan, a year-on-year increase of 70%. In the first three quarters of 2022, the company signed a total of 7.767 billion yuan, a year-on-year increase of 70.4%, the growth rate is among the highest in the plate. In terms of time periods, the newly signed 22Q1/Q2/Q3 contracts are respectively 17.51, 29.70 and 3.047 billion yuan, an increase of 225.53%, 133.13% and 10.92% respectively. From a business-by-business point of view, 22Q1-3 decoration / construction / municipal / materials sales / design business accumulatively realized the newly signed contracts of RMB 25.9531.12, which was-13.7%, 297.5%, 266.4%, 45.7%, 40.2%, respectively, compared with the same period last year. As of 22H1, the company has an order of 8.5 billion yuan on hand, with sufficient momentum for growth.
The cumulative number of newly signed housing construction / municipal projects has increased by 297%, showing that the company's ability to undertake large orders has increased by business: 1) in the first three quarters, the newly signed contracts for housing construction business totaled 3.112 billion yuan, a year-on-year increase of 297%.
In a single quarter, the newly signed contracts for 22Q1/Q2/Q3 housing construction reached RMB 8.05 million, respectively, with a year-on-year increase of + 2519%, 216% and 185%, respectively. The company's basic business continued to be sound and actively accepted orders for public construction projects. 2) the total newly signed contracts for 22Q1-3 municipal business totaled 1.87 billion yuan, an increase of 266% over the same period last year. In a single quarter, the newly signed contracts for 22Q1/Q2/Q3 municipal works were respectively 1.46 billion yuan for 5.93 Universe 130 Plus, and 173% for + 2189% Plus "103% Plus" respectively compared with the same period last year. Relying on the full life cycle service model, the company closely follows the national strategic planning, ploughing new urban construction and new infrastructure and other fields, the business side continues to make efforts, and the ability to undertake large orders continues to highlight.
The new business continued to make efforts, and the proportion of orders increased significantly by 16%. The company continued to develop new urban construction projects. In terms of new business, in the first three quarters of 2022, new business orders for renovation of old residential areas, renovation of historic buildings, municipal infrastructure and other new business orders reached RMB 5.80 billion, an increase of 30% over the same period last year, an increase of 30% over the same period last year. The cumulative increase of the three types of business was 195% year-on-year, accounting for 38%, a substantial increase of 16 percentage points. The logic begins to materialize, and the new business has a strong momentum.
The layout of the whole construction industry chain and the comprehensive development of the three new engines are expected to boost the performance higher than expected. 1) the business layout of the whole construction industry chain is perfect, and the main industry is developing steadily. The company is the only fully qualified enterprise in the industry with architectural design, construction, decoration design, decoration construction and production of new materials, with 27 A (1) qualifications. The company is mainly engaged in interior design and construction of public buildings, with design-driven orders. In the past five years, CAGR+21%,22 H1 has significantly outperformed its counterparts in the decoration sector, and its profitability continues to improve. With the coordinated development of the whole business chain, the company is expected to become bigger and stronger.
2) the renovation of old residential areas, the renovation of historical buildings, and the manufacture of high-performance doors and windows drive high growth. Old residential district renovation business: the potential market size for the renovation of old residential areas in Shandong Province during the 14th five-year Plan period is about 208.6 billion yuan, and the company is expected to take the lead to create a "1-year 3-year N" model for the transformation of old residential areas, with excellent payback from superimposed projects and high customer credit, which is expected to become the company's new business growth pole in the future. Historical style building repair business: the threshold for access to the track is high, and the competition pattern is clear; the company holds scarce first-class qualifications and is expected to achieve a new business breakthrough by virtue of differential competitive advantage; high-performance door and window business: the hardcover market of the 14th five-year Plan is expected to reach 3 trillion yuan, with an annual compound growth rate of more than 20%, which is expected to drive the high-end door and window market to continue to rise. The self-made production line of the company's high-performance system doors and windows is expected to be put into production by the end of 2023, which will bring an average annual revenue increase of 355 million yuan for the company.
Profit forecast and valuation
We estimate that the company's net profit from 2022 to 2024 will be 153 million yuan, 214 million yuan and 290 million yuan, an increase of 9.25%, 40.26% and 35.45% over the same period last year, corresponding to 15.76,11.23,8.29 times of PE respectively. We conservatively estimate that the compound growth rate for 22-24 years is 38%. Based on the PEG valuation perspective, the company's current corresponding PEG is only 0.42, the valuation level is in the undervalued range, the value needs to be found urgently, and the company is given a "buy" rating.
Risk hint
The execution of on-hand orders is not as expected, the development of new business is not as expected, the risk of future assets and credit impairment is higher, and the asset-liability ratio is higher.