SouFun backdoor Wanli shares, officially return to A shares. This transaction is divided into two parts: selling and issuing shares to purchase assets and supporting financing. 1) sell and issue shares to purchase assets. Listed companies will divest the original business and inject SouFun Internet real estate and home advertising marketing business, as well as SouFun financial business, to achieve a complete transformation of the main business of listed companies. 2) supporting financing. Soufang plans to raise no more than 3.1599999 billion yuan in three-year matching funds for non-public offering shares to 10 specific investors in accordance with 23.87 yuan per share.
SouFun was spun off and listed on the market, and the business was reorganized internally. Through this asset restructuring, SouFun has realized the spin-off listing of four businesses: trading, research, Internet marketing and finance. After the completion of the restructuring, US stock platform SouFun Holdings Co., Ltd. (SFUN.N) retains trading and research business, while holding 70.01% shares of A-share platform (600847.SH) through SouFun Fang Holdings Limited American Depositary Shares, Fang Holdings Limited American Depositary Shares network and SouFun Decoration, making it the largest shareholder. Mr. Mo Tianquan will become the actual controller of the listed company.
The war investor is strong, and the future business has room for imagination and cooperation. The supporting financing enterprises include Internet industry and investment giants such as Baidu, Inc., IDG Capital, Hongliu Investment, Carlyle Investment and so on. The investment of high-quality enterprises will help to ensure that enterprises build a stronger moat and help to realize the sharing of resources in the process of future development. More importantly, the current SouFun 3 quarterly report shows paper cash of 3.3 billion, this A-share refinancing of 3.16 billion, the company will have sufficient funds to cope with future industry changes.
SouFun oligarchy position will be further strengthened. SouFun's return to A shares this time will help enterprises to create an online and offline integrated profit model, further strengthen the import advantages of the original platform, and at the same time expand the development of overseas and innovative business (finance, etc.), so as to realize the status of global Chinese real estate platform. The above fundamental trends help SouFun to accelerate the completion of oligarchy, which is good for the medium-and long-term development of enterprises.
Investment advice: give a "buy" rating for the first time. Due to the relative scarcity of the A-share capital market real estate service industry chain and the lack of understanding of the industry by market investors, the current valuation level does not effectively reflect the real fundamentals, broad business space and reasonable market capitalization level of the real estate service market. Considering that SouFun belongs to real estate online portal enterprises, and the war investors involved in supporting financing have obvious interconnection background and advantages, we think that enterprises should be given a certain premium on the basis of the average valuation level of Internet enterprises. It is estimated that the operating income of the enterprise will be 77 million, 3.98 billion and 5.672 billion in 2015, 2016 and 2017, and the corresponding EPS will be-0.14,0.86 and 1.09 yuan. When trading was suspended on August 17, 2015, the company's share price was 33.09 yuan, compared with 2016 times PE in 2017 and 30.36 times in 2017. At present, the average valuation of Internet companies in 2016 is 56 times. On the above basis, we give the company a premium of about 20%, that is, a dynamic 67 times as the target valuation, with a "buy" rating for the first time corresponding to the share price of 57.62 yuan.
Risk hint: market systemic risk; whether the restructuring is successful or not is subject to regulatory approval.