Revenue is being pressured in stages to maintain the “buy” rating
On the evening of October 27, the company released its report for the third quarter of '22. 22Q1-3 achieved revenue of 42,969 million yuan, +9.90% year on year, net profit of 1,508 billion yuan, +16.13% year on year, net profit of non-Gimo of 1,416 million yuan, +10.77%, of which Q3's single-quarter revenue was 14.212 billion yuan, -15.60% year on year, Guimo's net profit was 475 million yuan, -8.37% year on year, after deducting non-Gimo's net profit of 454 million yuan, -14.77% year on year. Our judgment revenue slowed down in the quarter There is a certain relationship with the base figure, the progress of owners' projects caused by the epidemic, and their own revenue recognition progress. If the above influencing factors are expected to be partially resolved in Q4, an increase in revenue can be expected. Considering that Shandong's infrastructure will maintain a high boom in the 14th phase, I am optimistic about the company's medium- to long-term growth and maintain the “buy” rating.
Q3 orders have improved markedly. In the 14th phase, the company is optimistic about the sector segment. The 22Q3 company has signed new orders of 28.67 billion yuan, an increase of 67.85% over the previous year. By the end of Q3, the company had signed uncompleted/won unsigned orders of 1003.3/25.38 billion yuan, and the same period last year was 9773/19.25 billion yuan. The order side has shown a positive trend, providing good support for the company's revenue growth. Currently, the company is actively expanding the fields of major transportation and infrastructure. The winning projects involve 16 businesses such as road and bridge integration, municipal projects, industrial parks, maintenance and maintenance, etc. In the field, category expansion continues to advance, and we are optimistic about the subsequent carry-over speed of newly signed orders. Looking at the medium to long term, according to Shandong Province's “14th Five-Year Plan” comprehensive transportation plan, by 2025, the operating mileage of highways, railways, and rail transit in Shandong Province will increase by 2527/2639/361 kilometers, respectively, compared to 2020. There is still broad scope for investment in transportation infrastructure in segments within the province during the 14th Five-Year Plan.
The increase in net interest rate showed an improvement in profitability. Cash outflow decreased significantly. 22Q1-3 saw a marked decrease in the company's gross sales margin of 11.17%, the year-on-year +0.19pct, the company period expense ratio was 5.11%, and the year-on-year expense ratio was -0.02/-0.02/+0.15/-0.18pct year-on-year, respectively, and the 22Q1-3 company's asset (including credit) impairment loss as a share of revenue fell 0.16pct to 0.56% year on year. Under the overall impact of the 22Q1-3 company's net effect The interest rate was 4.39%, +0.21pct over the previous year. The CFO of 22Q1-3 company had a net outflow of 1.71 billion yuan, a year-on-year decrease of 1.62 billion yuan. The revenue ratio of the 22Q1-3 company was 70.3%, an increase of 8.39 pct over the previous year, and the payout ratio was 74.24%, an increase of 2.75 pct over the previous year. At the end of the third quarter of '22, the company's balance ratio was 77.73%, -1.04 pct compared to the previous year, and the balance and liabilities continued to be optimized.
Optimistic about the regional infrastructure boom and maintain the “buy” rating
We are optimistic about the prosperity of regional infrastructure and the company's competitive advantage. Considering the repeated impact of the epidemic on the company's operations, we slightly adjusted the net profit for 22-24 of 25.6/32.1/3.92 billion yuan (previous value was 26.1/33.5/40.2 billion yuan). Referring to other comparable companies in the infrastructure sector, Wind agreed to expect PE8.08X in '22. Considering that the company's potential growth rate is expected to be significantly better than the industry level, business layout expansion and cost control are expected to continue to translate into increased market share and profitability, giving the company 22 7 Double PE, corresponding to the target price of 11.50 yuan (previous value of 11.69 yuan), maintaining the “buy” rating.
Risk warning: the rise in raw materials exceeds expectations; project payback falls short of expectations; project implementation rate falls short of expectations