Events. The company publishes its 2019 semi-annual report. During the reporting period, the company's operating income was 1.427 billion yuan, an increase of 62.45% over the same period last year, and the net profit of shareholders belonging to listed companies was 445 million yuan, an increase of 11.12% over the same period last year. Realize basic earnings per share of 0.40 yuan.
In the first half of 2019, due to the partial confirmation of sales revenue of the "Biyun 10" project, the company's revenue increased by 62.45%; in the same period, the company's return net profit increased by 11.12% compared with the same period last year. The company continues to promote the renewal of key land cities, launch the landmark commercial project on the 17B-06 site, and promote urbanization projects such as the residential project on the S11 site (Biyunzun residence) and La Baodu commercial complex. In the first half of the year, the Lingang Biyun 10 Project completed the deposit contract, signed 123 sets of pre-sale contract, collected about 295 million yuan, and completed 116 sets of delivery certificate. Key projects: OFFICE PARK Ⅱ Metro Plate Project (T3-5), Yudu Workshop Ⅴ project (4-02 site), Biyunzun Mansion (S11 plot Housing), Yudu Workshop Ⅱ Phase (34-06), Yudu Workshop Ⅲ Phase (31-02) Project, Lalaport LaBaodu Commercial complex Project (T4-03), New material Innovation Base of Shanghai Northern suburb Future Industrial Park, etc.
According to the announcement of the company's operating data on August 29, from April to June 2019, the company's main business income totaled 597 million yuan, an increase of 31.41% over the same period last year, of which sales revenue was 201 million yuan, an increase of 309.41% over the same period last year, and rental income was 358 million yuan, down 1.59% from the same period last year. Hotel apartment income was 38 million yuan, down 8.40% from the same period last year. As of June 30, 2019, the Lingang Biyun 10 project developed by Shanghai Jinqiao Export processing Zone Real Estate Development Co., Ltd. (a 100% subsidiary of the company) has opened 81% of the housing supply.
Investment advice. Benefiting from the reform of state-owned assets and the construction of free trade zones, the rating is "better than that of big cities". The company is mainly engaged in the development, operation and management of Shanghai Jinqiao Economic and technological Development Zone. The company has gradually transformed from a park integration developer to an emerging urban development operator. The company adopts the business model of combining rent and sale and giving priority to rent. The company has factories, office buildings, residential buildings, shops and education, leisure and other investment properties of about 2.367 million yuan and about 3481 million tons of leased land. The main structure of the Biyun Zun residence (S11 plot residence) project has been capped, and the second structure has been completed by 95%. We believe that the construction of the Shanghai Free Trade Zone is expected to bring a revaluation of the company's land value, and the company's state-owned assets reform is expected to promote the company's further development in the future. We estimate that the EPS of the company in 2019 and 2020 is 0.97 yuan and 1.10 yuan respectively. According to the current dynamic PE valuation of the relevant comparable companies, we give the company 17-21 times the dynamic PE in 2019, with a six-month reasonable value range of 16.49-20.37 yuan, maintaining the company's "better than the market" rating.
Risk hint: the company's rental and sale business faces the risk of raising interest rates and policy regulation, as well as the risk of economic downturn.
