The acceleration of rail transit construction led to the release of the company's orders, giving a "buy" rating for the first time.
Relying on Guangzhou Metro Group, the company is expected to benefit from the rapid development of urban rail transit construction in Dawan area, and the accelerated release of newly signed orders is expected to help the company's rapid growth. At the same time, the company relies on years of industrial projects and technology accumulation. Stepping into the blue ocean market of energy-saving transformation of existing subway lines is expected to open up a new growth curve. We predict that the 23-25 year return net profit of the company will be 5.0 CAGR+25.6%, and as of June 28, the average expected average of the comparable company Wind will be 23 years 0.62xPEG. We believe that the rail transit design industry in which the company is located has a better pattern of high barriers, and the stock transformation is expected to bring new growth space. Approval gives the company 23 years 0.70xPEG, with a target price of 22.55 yuan. For the first time, coverage gives a "buy" rating.
With the centralized approval of rail transit projects, the rail transit investment in Guangdong Province is in the forefront of the country.
According to the statistics of RT rail transit, there are 7 rail transit projects approved every month in the first four months of 23 years, and a total of 38 projects are approved, while only 21 projects are approved in the same period of 2022. At the same time, according to the data of China Urban Rail Transit Association, by the end of 22, the total investment scale of Guangzhou and Shenzhen rail transit research approval ranked first and third in the country, respectively, with a total investment of 580 billion yuan; among the cities that have announced investment plans for 2023, Guangzhou Metro Group plans to complete the highest investment this year, reaching 90.1 billion yuan, and Guangdong rail transit is expected to continue its rapid development.
Backed by Guangzhou Metro Group, the technical strength is strong, and the continuous growth of orders injects the driving force for development.
The company has the highest grade qualification in engineering design, Class An and other industries, and is one of the enterprises with strong comprehensive design strength of urban rail transit in China. According to the China Urban Rail Transit Association, in 22 years, the company's market share in the national rail transit project was 19%, ranking second in the industry. The company relies on Guangzhou Metro Group. In 21-22, Guangzhou Metro has about 14 projects related to the company's business, of which 3-4 are in charge of the company, and the company's business has been strongly supported by the group. By the end of 22, the total amount of major sales contracts signed by the company reached 9.5 billion yuan, and the amount to be performed was 5.3 billion yuan, an increase of 17% and 9% respectively in 21 years compared with the same caliber. 23 years ago, the company announced that it had won the bid / signed a number of major projects. the total amount of winning / signing reached 2.89 billion yuan (only 60 million yuan in the same period in 22 years), providing a driving force for the company's follow-up growth.
The subway may enter the stock transformation period, and the energy-saving transformation of the blue ocean market is expected to bring new growth points for the company.
The transformation of existing lines is expected to become a new blue ocean in the rail transit industry in the future. We estimate that the theoretical market space for energy-saving transformation of subway lines in 2030 is expected to exceed 10 billion yuan. In November 22, the company announced that it won the bid for the pilot application of the contract energy management model for the environmental control system of Guangzhou Line 3 and 5, with a contract term of 16 years from the date of signing the contract (including 2 years of transformation), with a total bid price of 1.25 billion yuan, accounting for 50.48% of the company's business income in 2022. With the subway entering the peak period of inventory transformation, the company has accumulated rich scientific research achievements in rail transit energy saving and emission reduction, and the energy-saving transformation technology is expected to enter the industrialization stage, which will inject power into the company's future growth.
Risk hint: the progress of the project is not as expected; the rail transit construction plan is not as expected; the stock transformation is not as expected.