Main points of the report
Event description
Ruyi Group issued a 2014 performance forecast: from January to December 2014, the company achieved a net profit of 235 million yuan belonging to shareholders of listed companies, a sharp increase of 541 percent over the same period last year, corresponding to 1.16 yuan per share.
Event comment
The performance increased significantly, significantly exceeding our previous forecast of 0.95 yuan: from a quarterly point of view, it corresponds to 0.58 yuan in the fourth quarter, even 0.40 yuan in the third quarter.
The combination of futures and cash will be the long-term trend of domestic large traditional trade and entity enterprises: in 2014, China clearly issued policies to encourage commodity traders to take the road of combining industry with financial instruments. The recent acquisition of Wanda futures equity by Shanghai Huaxin Petroleum Group Co., Ltd. can also basically verify the gradual importance that the industry attaches to financial instruments. In our last recommendation report, we clearly mentioned the development path of the four major international grain merchants, all of which are the combination of entity, trade and finance, and gradually increase their voice through familiarity with the industrial chain. similar giant companies are bound to appear in China in the future. from the current situation of domestic development, Cofco and Broad (holding subsidiary of Ruyi Group) are the benchmark of domestic enterprises and represent the direction of domestic bulk traders. We are optimistic about the development of Broad products.
With the gradual increase of domestic futures varieties, we think it is beneficial for Broad products to improve the spot futures industry chain, and with the introduction of domestic crude oil futures, we think the company will play a great role in oil products trade. In the past, China's domestic futures varieties were scarce, and the means of hedging for industrial chain enterprises were extremely scarce, but in recent years, China has gradually introduced various futures varieties, covering many chemical products, coal, iron and steel, and agricultural products. and this is undoubtedly compatible with the ambitious business.
The company has obvious location advantages and is expected to become a professional large-scale chemical commercial enterprise. Ningbo Port is an important port of domestic commodities, mainly dealing with container, ore, crude oil, coal, liquid chemical products and other cargo loading and unloading, the regional transportation, logistics, warehousing and e-commerce business is developed; with the "Belt and Road Initiative" national strategy put forward, Ningbo Port will further expand its advantages, at the same time, the surrounding chemical products are more concentrated downstream, which is conducive to the company to carry out future-to-present business.
We expect the company to earn 1.16,1.80 yuan per share from 2014 to 2015. We believe that the company's business model is distinct. With the gradual improvement of futures varieties in the future, the company is expected to improve the commodity industry chain with the help of financial instruments and continue to recommend.
