Event: Jianghai Securities achieved operating income of 389 million yuan in February 2019, an increase of 175% over the same period last year, and its mother's net profit was 226 million yuan, an increase of 266% over the same period last year. From January to February, the cumulative operating income was 548 million and the net profit was 298 million yuan, an increase of 117% and 203% respectively over the same period last year.
The monthly net profit exceeds 200 million, and the performance of Jianghai Securities is remarkable. Jianghai Securities business structure depends on traditional brokerage and proprietary business, proprietary investment accounts for a relatively high proportion, in the market upward stage, performance elasticity is significantly higher than that of the industry. The net assets of Jianghai Securities (parent company) increased by 2.3% month-on-month in February, ranking first in the industry.
Market value disassembly valuation is low, high security and good flexibility. The thermal power, environmental protection and engineering parts of Harbin Investment Co., Ltd. are expected to be valued at 500 million, while the available-for-sale financial assets (China China Minsheng Banking Corp and founder Securities) are valued at 2.057 billion. At present, of the total market capitalization of Harbin Investment shares of 15.16 billion, Jianghai Securities corresponds to about 12.603 billion yuan. The corresponding PB of Jianghai Securities is 1.31x, which is significantly lower than the current industry valuation of 1.74x, but also lower than the comparable brokerage 2.40x, with a higher margin of safety.
Thermoelectric + brokerage, double main industry rotation. The company is one of the large local cogeneration enterprises in Harbin. In the heating area approved by the government, the company has regional heating franchise, obvious regional monopoly advantages, stable users and less competitive pressure in the same industry. In the securities sector, investment income is the main source of income, accounting for 63%. In the upward cycle of the market, the performance is very flexible.
Investment suggestion: we forecast that the company's 2020 operating income will be 2.38 billion yuan, the return net profit will be-1.13 billion yuan, and the corresponding EPS will be-0.05 / 0.66 billion yuan, respectively. The target price is 8.06 yuan per share, corresponding to 19 years PE12.21 times, maintaining the "buy" investment rating.
Risk hint
The progress of capital replenishment of the company is not up to expectations; the activity of market transactions and the persistence of incremental funds are not up to expectations; the rapid decline of the share prices of some pledged stocks causes the risk of stock pledge; the risk of stock market volatility.
