Eastern infrastructure vanguard, full growth of orders is expected
The company is a leading transportation infrastructure enterprise under Shandong Expressway Group, focusing on road and bridge construction and maintenance business. In 21 years, the total operating income of the company is 57.5 billion yuan, and the net profit of YOY+67.0%, is 2.14 billion yuan, YOY+59.5%. The company is based in Shandong, actively expand outside the province and overseas markets, 21 years newly signed orders of 101.04 billion yuan, YOY+44%. With the help of Dongfeng during the 14th five-year Plan, the company will continue to cultivate the main business of the project and expand the influence of the brand.
The transportation is strong and the province is strategically underpinned, and the future market awaits the opportunity.
During the 13th five-year Plan period, Shandong invested 740.5 billion yuan in transportation infrastructure, and the mileage of highways and railways rose to 7,473 million kilometers, ranking first in all provinces. However, the per capita ownership of expressways is relatively low, and transportation accounts for 2.5% of the general public budget expenditure, which has more room for increase. In response to the strategy of a strong province with strong traffic, Shandong's highway and railway mileage plan has increased to 10000,9700 km during the 14th five-year Plan period, and there is a broad market space for transportation infrastructure in the province.
The demand for highway maintenance expands, and diversified business adds to it.
The domestic highway maintenance policy has been gradually improved. Shandong plans to complete the maintenance project of expressways and ordinary national and provincial highways in the period of the 14th five-year Plan. It is estimated that the provincial highway maintenance market is about 26.5 billion yuan in 21-25 years, and the post-construction cycle market has full potential. The company also extends its business qualifications through investment in mergers and acquisitions, devotes itself to diversified development and actively expands its business territory.
Reorganization and merger of major shareholders to consolidate the leading position in the province
After Shandong Expressway Group, the major shareholder of the company, merged Qilu Traffic, the market share of highways in the province rose to 82.4%. Shandong Expressway plans to invest a total of 520 billion yuan during the 14th five-year Plan period. with the help of the synergy of the group, we expect the company to obtain nearly 200 billion yuan in business orders.
Profit forecast and investment suggestion
The company is optimistic about the development opportunities of road and bridge construction and maintenance business under the 14th five-year Plan in the province. We estimate that the operating income for 22-24 is 698.43 million RMB 847.41max 103.04 billion, and the net profit of return to the mother is 25.80 Compact 4.172 billion RMB. Based on the closing price on December 2, 22, the year 22-24 corresponds to a "buy" rating for the first time, corresponding to PE 4.5 Universe 3.6 hand 2.8 times.
Risk hint
The prosperity of transportation investment in the province is insufficient; the price of raw materials is rising; the project payback is slow; the impact of sudden factors on the progress of construction.