Event description
This report is our first follow-up report covering the company.
Event comment
Gain a foothold in Yunnan and expand the country. In 2015, the company achieved operating income of 4.013 billion yuan, a slight increase of 1.66% over the same period last year under the pressure of high inventory in Yunnan. Real estate revenue reached 2.552 billion yuan, of which real estate revenue in Yunnan reached 2.145 billion yuan, accounting for 84.05%. The main income contribution projects are Rongcheng Kunming Lake, Rongcheng Golden steps, Dali Erhai Tianyu, Dali Sea Oriental, Banna Rain Lin Lanshan and so on. The company has "Rongcheng" urban housing complex and "Dream Yunnan".
It is the two major product lines of tourism real estate. While ploughing Yunnan, it has laid out a number of key cities in southwest China, such as Chengdu, Chongqing and Xi'an, and strives to expand to the whole country.
Seize the strategic opportunity of "Belt and Road Initiative" to create tourism and leisure real estate. Relying on its own regional advantages, the company has established Yunnan Golden Lanmei International Tourism Investment and Development Co., Ltd. (the company has a 35% equity stake) with a number of professional operation and investment companies, and plans to make use of the Lancang-Mekong Golden Waterway. Gradually carry out the Lancang-Mekong comprehensive tourism real estate project, forming a "tourism real estate and urban complex, pension real estate" product line strategy. The Lancang-Mekong River area is rich in tourism resources and has great market potential. at the same time, the advantages of the "Belt and Road Initiative" policy will be gradually released.
Make use of the resources of Urban Investment Group to promote community allocation and O2O. Relying on the group's resources in education and medical treatment, the company takes Rongcheng Kunming Lake as a pilot project for community integration, medical, education, health and other resources. In the community O2O, the company launched the cloud guest service platform to integrate platform resources, achieve brand linkage, and enhance user life experience.
Rich in soil reserves, to boost sales for 16 years. At present, the company has entered first-tier cities, increasing its holdings and holding the Beijing Fangshan project, and arranging urban complexes in mature areas; in the reserve of tourism real estate resources, the company cooperates with Shaanxi Qinling Crown Industrial Co., Ltd. to develop and operate the Chaoyanggou project in Huangguan Town. By the end of 2015, the company has a total of 6 first-tier land development projects and 29 secondary land development projects (with an equity construction area of 7.6017 million square meters), almost all of which are located in second-tier cities.
The first-and second-level joint development model will also help the company to obtain more cheap and high-quality resources in the future.
Investment suggestion: as a rare tourism real estate target in the real estate sector, the company distributes the product line strategy of "tourism real estate and urban complex, old-age real estate" according to its own regional advantages. with the landing of the Greater Mekong River plan, the policy benefit is expected to be released gradually. we expect the company's EPS in 2016 and 2017 to be 0.30 and 0.35 yuan per share respectively, and the PE of the corresponding stock price to be 19.19,16.47 times respectively. For the first time, coverage gives a "buy" rating.
Risk hint: the market is declining and sales are not up to expectations.
