Main points of investment
Event: according to the annual report released by the company in 2015, the company achieved operating income of 641 million yuan in 2015, an increase of 34.71% over the same period last year; net profit of 126 million yuan, down 16.05% from the same period last year; and basic earnings per share of 0.66 yuan.
Comments:
Revenue has maintained rapid growth, and the "31st" business system has initially taken shape. In 2015, the company achieved operating income of 641 million yuan, an increase of 34.71% over the same period last year. Mainly because the company actively grasped the market opportunity in 2015 and strengthened its marketing efforts. In 2015, the company launched joint venture stations such as Changchun, Shenyang, Kunming and Zhengzhou, and opened franchise stations in 22 cities. As of February 2016, the company has covered 62 cities. In addition to the company's traditional advantages in East China, the company has also expanded its layout in the Northeast and Midwest. In 2015, the company's "31st" business system has initially taken shape: three businesses include services based on platforms such as "365 Taofang" and with "residence" as the core; home services based on platforms such as "decorating treasures and robbing foremen", and mobile life services based on "urban mobile matrix"; "1" refers to financial services, which the company has begun to run through the entire business system. In the future, the company should strive to build an "Anjia loan", an Internet financial platform matched with the main business, and timely establish consumer finance and microfinance services.
Expenses have increased rapidly, resulting in a slight drop in profits. In 2015, the company made a net profit of 126 million yuan, down 16.05% from the same period last year. The decline in the company's profit growth compared with the same period last year is mainly due to the increase in the number of offline service items in the company's real estate marketing and the increase in fees brought about by the development of new businesses such as Xianbao and the Internet. We expect that in the future, with the gradual maturity of the company's business, after the formation of a certain scale effect, the costs will be significantly reduced, and the company's performance will continue to improve in the future.
Investment advice: the company's 2015 performance is in line with expectations, revenue maintains rapid growth, and the "31st" business system is initially taking shape. We are optimistic about the in-depth layout of 365 network in the real estate post-service market and the company's long-term development prospects. In 2016-2017, the EPS is expected to be 1.0,1.50 yuan, corresponding to 36.4 and 24.3 times of the PE, respectively, maintaining the "overweight" rating.
Risk tip: sales recovery is not as good as expected.