Urbanization and industrialization in Liaoning area enhance land value. Tieling Caijing Investment Co., Ltd., a wholly-owned subsidiary of the company, was established as a city operator responsible for the first-class development of 22 square kilometers of Tieling New Town and the construction and operation of urban infrastructure in Tieling New Town. The income from primary land development accounts for 99% of the company's operating income. In 2011, the urbanization rate of Tieling was only 47.66%. It is expected to reach 70% of the province's target by the end of 2015. Thanks to urbanization and industrialization, the average land price in Liaoning shows an obvious upward trend.
Horizontal replication is opened and the land development agreement of Lianhua Lake is signed. In order to further enhance the urban development of Tieling New City, shape the city brand and gather popularity, the people's Government of Tieling City authorized the Construction Management Committee of Tieling New District and Tieling Caijing Investment Co., Ltd. reached a framework agreement on land consolidation, infrastructure construction and other related issues in the Lianhua Lake area of Tieling City. Lianhua Lake area of land development area of about 5 square kilometers. The company is responsible for completing the relevant regional land consolidation, infrastructure construction, public facilities construction and environmental restoration construction on time. The important position of Lianhua Lake Wetland Park has laid the foundation for the promotion of land value.
Tieling new town land development has entered a later stage, contributing to a stable income. According to the "Regulatory detailed Planning of Fan River New District, Tieling City", Tieling New Town is divided into three areas for development, with a development area of about 4.4 square kilometers, a development area of 11.9 square kilometers, and a development area of 5.7 square kilometers to the south of Fan River. At present, the main income of the company is the final payment of the first-level land development and start-up area and expansion area south of the Fan River. The relevant settlement income grew steadily and remained calm.
Profit forecast and valuation. It is estimated that the company's EPS in 2014 and 2015 will be 1.58 and 2.03, and the corresponding share price PE will be 8.8x and 6.8x. The "overweight" rating is given for the first time. The target price is 18 yuan.