Investment logic
The performance entered the growth track and the high delivery boosted expectations: the company achieved operating income of 270 million in 2015, an increase of 171.2% over the same period last year. At the same time, it earned 82 million of investment income from the disposal of forest assets and 30 million of non-operating income from expected liabilities. Finally, the net profit attributed to shareholders of the listed company was 40 million, an increase of 107.1% over the same period last year. With the improvement of operating property income, the substantial reduction of financial expenses and the contribution of new business sectors, the company's performance has stepped into the growth track. In addition, the company's board of directors examined and approved the profit distribution plan, which is proposed to increase 10 shares for every 10 shares from the capital reserve fund to all shareholders on the basis of 570 million share capital, which will help boost market expectations.
Operating and financial indicators have improved significantly: since the company's core project, Huangting Plaza, was put into operation at the end of 2013, the main operating indicators have improved significantly, with the average daily passenger flow stable at about 45000 at the end of 2015, with a maximum of 78000 per day. The overall revenue of the square increased by 154% compared with the same period last year. In addition, the company's property management income increased by 86.8%, and other income increased by 27.3%. The property rental gross profit margin rebounded to 93.7%, and the property management gross profit margin rebounded to 25.6%. The company completed a fixed increase last year, raising 3.1 billion of the capital, and 1.98 billion after deducting equity subscription and issuance costs, so that the company repaid some of the loans, resulting in a 125 million reduction in financial expenses last year. In addition, the sales and management fees have been greatly reduced. The asset-liability ratio fell sharply to 37.5% from 62.8% at the end of 2014.
Rapid layout under the guidance of light asset model: at the beginning of listing, the company mainly engaged in commodity retail, and after the completion of restructuring in 2010, it was determined to take commercial real estate operation as its core business. In 2014, the company plans to transform and actively explore new business under the guidance of light asset operation. In 2015, the company completed the renaming and fixed increase, the acquisition of Shenzhen Huangting Cultural Development Co., Ltd., the establishment of Huangting Fund Management, Huangting online, Huangting Real Estate Management and other companies. In addition, in order to create an investment platform with unique business content, the company has established joint ventures with Wangfujing Management Company and Beijing Shengli Commercial Investment Management Co., Ltd.
Financial services business opening, equity incentives to increase efficiency: in 2016, the company acquired shares in concentric funds through equity acquisition and became its largest shareholder, and indirectly obtained a micro-re-loan business license. the company has made a substantial breakthrough in building the financial services strategic system of Huangting International. In addition, the company implemented the first phase of the employee stock ownership plan, and purchased a total of 2.241 million shares of the company by December 21, 2015, accounting for 0.4% of the total share capital.
Investment suggestion
The company is expected to achieve EPS0.16 yuan in 2016, taking into account the high performance growth, the fair value of core projects and the positive landing of new business, we cover and give an overweight rating for the first time.
Risk hint
The growth rate of the company's rental revenue is lower than expected, and the progress of the financial services and high-end consumer services business is slow.