Event description
Beijing Investment Development Bulletin 2016 semi-annual report, the main contents are as follows:
In the first half of 2016, the company achieved operating income of 1.367 billion yuan, a year-on-year increase of 117.17%, a net profit of 40 million yuan, an increase of 133.19%, a net profit margin of 2.9%, an increase of 21.84% over the same period last year, and an EPS of 0.05 yuan. Among them, the operating income in the second quarter was 365 million yuan, down 36.41% from the same period last year, the net profit was 4 million yuan, up 106.71% over the same period last year, and the net profit margin was 0.97%, up 10.19% from the same period last year.
Event comment
The carry-over volume increases, the gross profit margin picks up, and the expense rate decreases. During the reporting period, the carry-over volume of the company's projects in Beijing, such as Yuyufu, Shanglin Bay, and New mileage, increased significantly, with operating income rising 117.17% and gross profit margin also rising 9.07 percentage points. In addition, benefiting from the reduction in the expense of interest expenses and the reduction in financing costs, the company's financial expense rate dropped significantly by 9.03%, and the company's performance increased significantly in the first half of the year.
Excellent sales performance, adequate supply reserves. The company's main projects for sale are located in the Beijing area, and sales are good in the first half of the year. The subscription removal rate of projects in Beijing is as high as 81%, and the sales amount is 3.731 billion yuan, an increase of 35.28% over the same period last year, effectively ensuring future performance. In addition, the company's final inventory value is 22.3 billion, and the supply reserve is relatively sufficient.
Optimization of debt structure. During the reporting period, the company's asset-liability ratio and real debt ratio were 89.68% and 86.39% respectively, still at a high level in the industry, but the debt structure was optimized. The company issued 1 billion yuan of three-year corporate bonds in March and August 2016 respectively, with coupon rates of 5.24% and 4.98% respectively, lower than the company's annual financing cost of 8.63%.
The control of major shareholders is stable and the strategic positioning is clear. The dust of the company's equity problem has settled, and the proportion of shares held by the Beijing Investment Group has risen to 32% after the completion of the implementation of the plan to increase its shareholding, further increasing its control over listed companies. Beijing Investment Group undertakes the functions of investment and financing, planning and development in the construction of Beijing rail transit. The company's future development strategy of "taking Beijing as the center and relying on rail transit" is clear.
Investment suggestion: the EPS is expected to be 0.18 and 0.24 yuan per share in 2016 and 2017 respectively, and the corresponding share price PE is 51.08 and 38.58 times, maintaining the "buy" rating.
Risk hint: property market policy tightened
