This report is read as follows:
The improvement of scale effect and the full release of C2 performance are expected to drive the company's 18-year performance to achieve higher-than-expected growth, and the subsequent reduction of financial leverage is expected to improve the company's valuation.
Main points of investment:
Maintain the "overweight" rating and maintain the target price of 9.19 yuan, corresponding to 18p B1.6X Magazine 18P hand E16X. The company's 17-year operating income / parent net profit is 35.93 billion yuan, compared with the same period last year, + 48.1%, 15.5%, 8.4%, and + 58bps, which is in line with our expectations. The company plans to pay 0.60 yuan for 10. In 17 years, the C2 consolidation of aircraft leasing assets and the endogenous growth of leasing business drive 17 years of performance growth of the company; the improvement of scale effect and C2 performance release are expected to drive the continuous growth of the company's subsequent performance, taking into account the endogenous growth rate of leasing business, adjust EPS from 2018-20 to 0.58 shock 0.82 yuan (0.57 plus 0.77 yuan in 18-19 years).
The leading position of leasing has been further consolidated and the scale effect has gradually emerged. 1) in 17 years, the company completed the acquisition of C100% equity and GECAS asset package, integrated aircraft leasing business with Avolon platform, and showed economies of scale. At the end of the year, the company owned, managed and ordered 943 aircraft, which was the third largest in the world in terms of fleet market capitalization. The growing fleet strengthens the company's bargaining power and effectively reduces aircraft procurement costs. 2) at the end of the year, the company owned and managed about 3.55 million CEUs of containers, the second in the world, the company's container sector revenue and gross profit margin increased slightly compared with the same period last year. 3) the development of domestic leasing business is improving, and the business income in mainland China in the past 17 years is + 23% compared with the same period last year.
C2 performance in 18 years is fully reflected, and the decline in financial leverage is expected to improve valuations. 1) C2 transferred ownership in April 17, contributing a total of 1.09 billion yuan to the company's performance for only three quarters, while C2 merger fees and financial expenses arising from advance financing totaled 570 million yuan. The release of C2 annual performance and the reduction of expenses will drive the company's 18-year performance to increase significantly compared with the same period last year. 2) according to the annual report, the company intends to effectively reduce the overall level of assets and liabilities by means of war and asset integration, and the shareholders' meeting in September 17 approved a plan to issue preferred shares of no more than 8 billion yuan, and the reduction of financial leverage is expected to improve the valuation level of the company.
Catalyst: measures such as the issuance of preferred shares to promote the reduction of the company's financial leverage; the promotion of epitaxial financial layout.
Risk hint: business integration is not as expected.
