Main points of investment:
Overwrite the overweight rating for the first time. The company is an assembly design company seriously undervalued by the market. We predict that in 2020-22, the EPS of the company will be 0.88max 1.11max 1.38 yuan, a growth rate of 22x26x24%. Combined with the two valuation methods of PE and PS, the target price is 20.77 yuan, and the target price corresponds to 23.6max 18.7exp 15.1 times PE in 2020-21-22, covering the overweight rating for the first time.
The company is a seriously undervalued assembly design leader, with steel structure design accounting for about 20-30% of the income of its peers. 1) the company's deep ploughing assembly design, especially steel structure and prefabricated PC structure design, is the first batch of assembly construction industry base and the first batch of pilot enterprises for full-process consultation, and has been selected as one of the "Top Ten Private Engineering Design Enterprises in China" for 4 consecutive years. 2) more than 80% of the company's projects include assembly design, and the income from special design of prefabricated buildings accounts for about 40%. 3) the company is the listed company with the most immature and extensive application rate of prefabricated steel structure design, and we expect that the proportion of steel structure design is higher than that of peers; 4) the company has designed Suzhou Modern Media Plaza (steel structure) / Suzhou Bay Cultural Center (steel structure + BIM) / a residence in Evergrande Nantong (PC structure), etc.; the prefabricated assembly rate of several projects is as high as 80%.
The technology / talent reserve of the company is strong, and the PE is only 14 times the lowest in history and 39 times lower than Huayang International.
1) We predict that the scale of domestic steel structure + prefabricated PC structure front-end design market is at least 100 billion, and the company's income in 2019 is only 1.9 billion yuan, typical large industries and small companies; 2) strong technical strength, with 10 core technologies such as large cantilevered high space truss structure design technology, a total of 165patents have been granted 3) sufficient talent reserve (more than 3000 technicians / 1 national master of engineering survey and design / 2 recipients of special allowance of the State Council); 4) PC+BIM+ hardcover / integrated design to improve the collaborative ability of various specialties; 5) strong organizational structure and management advantages / rich engineering experience / strong brand advantages / regional layout and other advantages; 6) promote EPC business 7) the current PE is only 14 times that of Huayang International, which is the lowest in history (41 times on average in recent 5 years) and far lower than that of Huayang International.
Catalyst: policy supports core risks such as the enhancement of prefabricated steel structure and the improvement of prefabricated design capability: the promotion of steel structure is not as expected, the shackles of traditional construction methods, the weakening of technological advantages, etc.