Contents of the contract:
On December 4, 2012, the company and Yueyang Transportation Construction Investment Co., Ltd. signed the "Yueyang Linxiang-Hubin Highway Investment and Construction Agreement" for the Yueyang Linxiang-Hubin highway project, with a contract amount of about 1.1 billion yuan, accounting for 37.96% of the total income in 2011. the construction period is tentatively scheduled for 40 months.
The project is one of the 100 key construction projects in Yueyang in 2012. According to the Yueyang government, the announcement project is an important longitudinal highway channel in the eastern part of Yueyang City: Linhu Highway starts at the intersection of Linxiang G107 and Beijing-Hong Kong-Macao Expressway Linxiang connecting Line, along the existing G107, via intersection, Yunxi, Gaoqiao, Huanggutang, deviates from G107 line in Mapo via Zhangshupu and Chen Jialong, ends at Lakeside Horticulture Farm in Nanhu Scenic spot, connects with Yue Rongxin Highway, with a total length of 52.1 km. The whole line is built according to the first-class highway standard, with a design speed of 80 km / h and a roadbed width of 26 m. The total investment of the project is about 2.05 billion yuan.
The economic development and financial situation of Yueyang City is better than the overall level of the country, and the performance ability is trustworthy. From January to October 2012, Yueyang completed a fiscal revenue of 19.318 billion yuan, exceeding the total revenue of 18.553 billion yuan in 2011, an increase of 25.8 percent over the same period last year. The data show that the cumulative year-on-year growth rates of financial revenue and industrial value added of Yueyang City are 14.6 and 4.3 percentage points higher than the overall national level, respectively. The local economy develops rapidly and steadily, the government has a strong ability to pay, and the project default risk can be controlled.
The "new urbanization" is expected to significantly boost the domestic engineering business of Beixin Road and Bridge. According to statistics, the urbanization rate in China's eastern coastal areas is generally more than 50%, or even 80%. Therefore, we believe that the central and western regions are the protagonists of this new round of urbanization. In order to facilitate the flow of factors of production and products, and to create a good industrial investment environment, the transportation infrastructure (including roads, railways, ports, airports, etc.) used to connect cities and towns and the interior areas of third-and fourth-tier cities will certainly bear the brunt and become the first step in promoting a new type of urbanization. As the largest highway construction enterprise in Xinjiang, in recent years, while maintaining its advantages in Xinjiang and expanding the overseas business of the countries bordering Xinjiang, the company has actively laid out and ploughed the domestic market in the central and western provinces. It is expected to win rich orders in the process of new urbanization.
Profit forecast and rating. We roughly estimate that the contribution of the project to the company's earnings per share from 2013 to 2015 is about 0.02 yuan, and temporarily maintain the company's forecast of 2012-2014 EPS of 0.11,0.13 and 0.15 yuan, respectively. We suggest that we should actively pay attention to the company's thematic investment opportunities and follow-up newly signed orders.