Event: on March 30, 2015, Qianjiang Water Conservancy released its 2015 annual report. According to the annual report, the company achieved an operating income of 804 million yuan in 2015, an increase of 0.18% over the same period last year, of which the operating income of the water supply and treatment industry was 736 million yuan, an increase of 3.32% over the same period last year. The combined net profit of the owner of the parent company was 41.2473 million yuan, an increase of 132.98% over the same period last year. The profit growth is mainly due to the growth of the company's investment and financial income and the substantial increase in the profit of Paradise Silicon Valley.
The growth rate of the main water business slowed down, and venture capital led the overall income: the year-on-year growth rate of the operating income of Qianjiang water conservancy and water conservancy decreased slightly, from 8.03% in 2013 to 3.32% in 2015, while the company's net profit increased significantly in 2015. the contribution mainly comes from the substantial increase in the net profit of Paradise Silicon Valley, the company's shareholding company. The net profit of Paradise Silicon Valley in 2015 was 122 million yuan, up 1469.47 percent from 7.7776 million yuan in 2014 (company announcement). The company's participation in venture capital drives the overall income.
The state encourages venture capital, and the prospect of the venture capital industry is bright: the government work report in March 2016 proposed to promote the healthy development of the multi-level capital market, the government attaches importance to the construction of the multi-level capital market, and the reform of the gem and the new third board will continue. The reform dividend will be released in the future. In 2015, there were 721 new venture capital funds set up by venture capital institutions across the country, with an additional investable capital of 220 billion yuan, and the total investable capital reached 396.1 billion yuan, an increase of nearly 80% (according to the Qingke Research Center). The venture capital industry is expected to have a bright future in 2016.
Paradise Silicon Valley has completed the capital increase and share expansion, and the development trend is good: on December 25, 2015, the company announced that it will participate in the 2015 capital increase and share expansion plan of Paradise Silicon Valley with its own capital of 285 million yuan. the company still holds 27.90% of its shares after the capital increase, and the project investment has been completed at the end of 2015 (company announcement, the same below). As of December 31, 2015, Paradise Silicon Valley had total assets of 2.6 billion yuan, net assets of 2.09 billion yuan and operating income of 330 million yuan, an increase of 205.5%, 272% and 500% respectively over the same period last year. Paradise Silicon Valley is developing well, and the company is expected to continue its rapid development in 2016.
Investment advice: maintain the buy-An investment rating with a 6-month target price of 17 yuan.
Risk hint: venture capital industry risk; transformation risk