Event: on September 8, China Shipping Container Transportation Co., Ltd. (China Shipping Container) held an unveiling event and officially changed its name to COSCO Shipping Development Co., Ltd. The abbreviation of A-share listed company has been changed to "COSCO Haifa".
Layout of financial shipping, transformation of a comprehensive financial service platform: the company's asset restructuring work has been basically completed.
Listed companies have changed from container liner operators to comprehensive financial service providers relying on shipping finance and comprehensively developing non-aviation financial leasing business.
Relying on container leasing business, committed to the development of non-aviation leasing: the company's Florence and other companies have a total container fleet of 3.5 million TEU, ranking second in the world, with leasing revenue of 4.15 billion in the first half of the year. Such a large size of the box fleet will give full play to the advantages of scale from various angles to stabilize the core business of shipping finance. In terms of non-aviation leasing, the company is committed to developing financial leasing business in many fields, and the current balance of financial leasing assets has exceeded 10 billion yuan.
The financial investment business has been tried out, and the financial platform of central enterprises has been laid out twice: on May 19th, * ST Jinrui announced the plan to increase, and China Shipping Container plans to participate in it and join hands with Minmetals to build its financial control platform. If the project goes smoothly, China Shipping will subscribe for 148 million shares at 1.5 billion yuan, accounting for about 3.96 per cent of the total share capital after the fixed increase. On Sept. 5, * ST Jichai announced the plan to be increased, and China Shipping Container plans to participate in it and join hands with Petrochina Company Limited to build its financial platform. If the project goes smoothly, China Shipping will subscribe for 87.88 million shares at 950 million yuan, accounting for about 0.97% of the total share capital after the fixed increase.
In the future, we plan to build a supply chain integrated financial service platform: through participation in Dingzeng, the company indirectly controls the financial platform of central enterprises and touches a wide range of business, such as banking, securities, insurance, trust and so on. According to the company's strategic plan, the financial core industry cluster will be built in the future, and a financial service group with multi-business coordinated development will be established.
Hanjin incident may be a short-term driver for the company: Hanjin Shipping Company, which ranks eighth in the world, applied for statutory administration (similar to bankruptcy protection) to Seoul Central District Court on August 31. We believe that at a time when Container TOP20 Company is basically allied, Cosco has completed integration, NOL is acquired by CMA, and industry concentration increases, Hanjin incident will lead to its short-term absence from the traditional peak season (pre-Christmas shipping time). In the market, which is usually from August to November, liner companies are likely to take advantage of this opportunity to sharply raise their previously extremely depressed freight rates, leading to expectations of price increases. Both container transportation itself and container leasing can get a potential stimulus, or give a certain boost to the company's performance.
Investment suggestion: the company's EPS from 2016 to 2018 is expected to be 0.01,0.12,0.15 yuan. Considering that the Hanjin incident in the short term may be conducive to the peak season price increase and the slight recovery of the market, it is given a-A rating, with a 6-month target price of 4.82 yuan, corresponding to 40 times and 32 times of PE for 17-18 years, respectively.
Risk hint: the economic downturn is higher than expected, the container leasing market is depressed, and financial business expansion is weaker than expected.