Investment events:
The company issued a draft of major asset restructuring, which intends to use 945 million yuan in cash to buy a 45% stake in Shanghai Jiefu, becoming the largest shareholder of Shanghai Jiefu. The performance commitments of Shanghai Jiefu in 2016, 2017 and 2018 are 150 million yuan, 200 million yuan and 250 million yuan respectively.
Summary of the report:
If the card is paid by the third party, Shanghai is rich in resources and high quality. Shanghai Jiefu is a holding group company specializing in data services for small and micro merchants. Baiku, a subsidiary of the company, has a national bank card receipt license and provides bill-to payment for the various payment needs of small and micro merchants through MPOS hardware terminals. It is in the middle and upper reaches of MPOS intelligent order collection field. Shanghai Jiefu's payment APP, that is, Alipay daily active users also ranks 13th among 63 mobile payment APP. At present, Shanghai Jiefu has established strategic partnerships with more than 1700 outsourcing service organizations, serving a total of 2.5 million customers and establishing 36 branches in various provinces and cities, covering the whole country and rich resources.
The financial layout will be the next city to further strengthen the synergy. The company has previously set up a pioneer fund, acquired Hong Kong Yisheng Securities, directed additional issuance to the financial technology cloud service platform project, and set up Zhonghui Mutual Insurance Company. This acquisition further improves the company's layout in the financial sector and produces synergy with existing financial businesses. In addition, the company will get a large number of small and micro business transaction data after this acquisition, which is also conducive to the further extension of the company's big data field layout.
The target of acquisition has good growth, strong profitability and thickening performance. Shanghai instant wealth, the target of this acquisition, is growing rapidly and has good profitability. its net profit in the first half of 2014, 2015 and 2016 was 1.2424 million yuan, 43.5101 million yuan and 74.8436 million yuan respectively, and the cumulative transaction amount in the first half of 2016 reached 279.425 billion yuan. the performance commitments of this acquisition in 2016, 2017 and 2018 are 150 million yuan, 200 million yuan and 250 million yuan respectively. Mergers and acquisitions will significantly increase the company's profits.
Investment advice: assuming that the company amalgamates for the whole year of 2017 and does not take into account the remaining 20% equity acquisitions, the company is expected to upgrade to "buy" rating from 2016 / 2017 EPS 0.10max 0.34.
Risk hint: uncertainty of major asset restructuring