Event: recently, the company received a notice of selection for the 2019 computer room rental procurement project issued by the Purchasing Management Center of Shenzhen Ping an Comprehensive Financial Services Co., Ltd. The company is determined to be the single selected unit of the bidding project of "Ping an Science and Technology 2019 computer Room Project". It is estimated that the total amount of the project is about 2.6 billion yuan.
Winning the large order of Ping an Technology highlights the core value of the company's data center. 1) the company won the bid for Ping an Science and Technology computer room project in 2019. During the 10-year lease period, the number of racks in the data center computer room is about 2620, and the total estimated amount of the project is about RMB 2.6 billion. This is the second year in a row that Ping an Science and Technology computer Room project has been selected after 2018, and the amount of money has greatly exceeded that of previous years. 2) this big order is not only the recognition of the company's IDC business capability by Ping an Technology, but also the highlight of the company's core data center value in first-tier cities. With the increasing demand of financial giants such as Ping an in the construction of financial information infrastructure, it is expected that the company may still win the bid in the future.
The card is located at the core node of the Greater Bay area, and the IDC business is expected to make a profit on a large scale in 2019. 1) in the two city agglomerations (Guangdong-Hong Kong-Macau Greater Bay Area and Xiangjiang Ring Changsha-Zhuzhou-Xiangtan Urban agglomeration), the company has a large market leading edge in IDC business. There are 5 self-built IDC distributed data centers, and the total planned rack size will reach 30,000, reaching the Tier4 level (the highest level in the internationally recognized data center standards), that is, the financial A-class standard construction. Customers who have been stationed and have signed contracts are Baidu, Inc., Tencent, Youku, 360, JD.com, China Telecom Corporation, Ping an Communications, Changsha Municipal people's Government and so on. 2) the period from 2016 to 2018 is the investment period of IDC business, and the revenue and profit are under pressure periodically. Since the second half of 2018, the company has continuously won large orders for high-quality customers, especially Ping an Technology continues to increase IDC construction, and IDC business is expected to usher in large-scale profits in 2019.
In 2020, the target market value is 7.5 billion yuan, maintaining the "overweight" rating. According to the key assumptions, the operating income from 2018 to 2020 is expected to be 1.438 billion, 2.275 billion and 3.438 billion respectively, and the net profit from 2018 to 2020 is 6 million, 106 million and 209 million respectively. With reference to the valuation of companies in the same industry, and considering that the highest quality financial customers account for a large proportion and the profitability is higher than that of the same industry, the 2020 target market capitalization is 7.5 billion yuan, corresponding to PE 36x. Maintain the "overweight" rating.
Risk tips: the progress of cabinet launch is not as expected; the company benefits less than expected in the Great Bay area; macroeconomic risks; the risk that key assumptions are not in line with the actual situation.
