Main points of investment:
The founder of the domestic Ocean theme Park, new projects have been invested one after another. Dalian Shengya is the only listed tourism company in Liaoning. The company operates five venues in Dalian, including SeaWorld, Polar World and Deep Sea Legend. The company established Harbin Polar Pavilion in 2005. In recent years, the company's layout throughout the country, light assets export projects Wuhu and Huai'an projects have been opened in 2016 and 2017, the fifth generation Ocean Park project Zhenjiang project is under construction. In 2018, the company's annual revenue totaled 348 million yuan, up 0.84% from the same period last year; the net profit was 58 million yuan, up 3.96% from the same period last year; and ticket revenue accounted for 84.6% of the annual operating income.
The original aquarium gradually entered a mature period and became a steady cash cow. Since 2011, the company has maintained a gross profit margin of more than 50%, and has increased year by year. Under the trend of the decline in the overall profit level of the industry, it has become one of the few marine venues that make a profit by relying solely on ticket revenue. In 2018, Dalian's revenue was 278 million yuan, up 1.47% from the same period last year; Harbin's revenue was 72 million yuan, down 1.01% from the same period last year. At present, the two venues are gradually entering a mature stage, the second phase of Harbin project is still under development, and the reception volume has reached a short-term bottleneck. The growth of the original part mainly depends on the natural leverage advantage of heavy asset projects and steady growth.
The fifth generation aquarium in Zhenjiang is still under construction, and there is a great demand for funds for heavy assets projects. The total investment of Zhenjiang project is 1.089 billion yuan. the company originally planned to raise funds for the construction of Zhenjiang SeaWorld project by fixed increase, but the subsequent increase failed and the progress was delayed.
The equity transfer agreement of Zhenjiang Project Company was signed on November 26, 2018: 40.98% of the equity of Zhenjiang Moby Dick was transferred to the investor Chongqing Modern Logistics Industry Equity Investment Fund Management Co., Ltd., the company still holds the control after the transfer, and the scope of the merger remains unchanged, so as to reduce the financial pressure. According to our forecast, when the project matures (2026), it will contribute 478 million yuan in revenue and 159 million yuan in net profit after tax. According to the share of 29.02%, the net profit contributed to the mother is 46.28 million yuan.
It is expected that with the concentration of epitaxial expansion, Sanya's technological and resource advantages in marine and polar animals will be truly translated into market value. At the end of 2018, the value of the company's productive biological assets was only 16.83 million yuan measured by the cost method, and these animal stars contributed 348 million yuan of business income to the venue. In 2018, Dalian headquarters successfully bred 32 Papuan penguins independently, and the Harbin project successfully bred 15 Papuan penguins. It is the single venue with the largest number of successful breeding penguins in China, and the market price of an adult penguin is between 30 and 400000. The biological assets realized through breeding in Sanya alone have huge market value. Therefore, the animal resources bred and domesticated every year can not only provide material guarantee for the remote replication of Shengya Aquarium, but also indirectly realize its market value by the way of animal ownership.
Profit forecast and investment advice: we estimate that the EPS of the company from 2019 to 2021 is 0.45max 0.55 yuan respectively, and the corresponding PE is 73-73-59 times. As the short-term contribution to profits of the Zhenjiang project is limited, and considering the stable cash flow attribute of the scenic company, we evaluate the company by DCF and get the equity value of the company is 4.009 billion yuan, and the current market capitalization of the company is 4.205 billion yuan, which is covered for the first time and given a neutral rating.
Risk tips: the impact of sudden natural or social events on the tourism industry as a whole risk; the main competitors to develop IP ecology, the future industry competition pressure is increasingly fierce; Zhenjiang project construction is not as expected.