Comprehensive investment platform, performance is highly dependent on Dongfeng Yueda Kia. The company is a comprehensive investment enterprise, covering a wide range of business. The sharp decline in the company's performance over the past 15 years is mainly due to a significant deterioration in Dongfeng Yueda Kia, the main source of the company's profits.
Dongfeng Yueda Kia performance is expected to usher in a reversal. Dongfeng Yueda Kia's 15-year net profit fell by 76%. Sales are good this year; the proportion of more profitable SUV and D-class cars has increased significantly; and the policy of halving the 1.6L purchase tax will give a good boost to car sales for the whole year. Dongfeng Yueda Kia will also launch pure electric models this year, and new energy vehicles will also become the focus of its future development. It is expected that Dongfeng Yueda Kia's profit situation will improve significantly this year, effectively improving the company's performance.
Relying on Yueda Group, there is much room for imagination in capital operation. The controlling shareholder of the company is Yueda Group, which belongs to Yancheng State-owned assets Supervision and Administration Commission. Yueda Group has annual revenue of more than 100 billion yuan and many businesses. "Capital Operation achievements" is its important work this year. Yueda Investment, as the company's best listing platform, will benefit from the parent company's capital operation strategy in the future.
Cover for the first time and give a "recommended" rating. We estimate that the EPS of the company from 2016 to 2018 is 0.41,0.64,0.76 yuan respectively, and the price-to-earnings ratio is 19 times, 12 times and 10 times respectively. Considering that the company's PB is currently low, the profitability of Dongfeng Yueda Kia, the main source of profit, is expected to improve significantly. Cover for the first time, give the company a "recommended" rating.
Risk factors: (1) Dongfeng Yueda Kia's profitability is not up to expectations; (2) the company's other business profitability has significantly deteriorated.