Introduction to this report:
The company's business has fully recovered, and net profit has greatly exceeded expectations. Deeply lay out the integration of industry and finance, and the CMM Exhibition, the Guangdong Smart Expo, and the IARS Exhibition contributed incrementally; continued to promote two major strategies, continuously expand business models, and continuously improve core competitiveness.
Key points of investment:
Maintain an increase in holdings. Considering the full recovery of business, maintaining an EPS of $0.54/0.58/0.61 for 23/24/25 was $0.54/0.58/0.61. Give the industry average valuation of 28xPE in 2023, maintain the target price of 15.08 yuan, and maintain the increase in holdings.
Performance summary: Performance greatly exceeded expectations. 23H1 achieved operating income of 570 million yuan/+398% year on year, realized net profit of 190 million yuan, turned loss into profit, and achieved 110 million yuan/year on year after deducting non-net profit of 110 million yuan/year on year.
Among them, 23Q2 achieved revenue of 5.1 million yuan/year on year +596%, net profit of 200 million yuan/year on year +369%, net profit of 150 million yuan/year on year after deducting non-net profit of 150 million yuan/year on year.
The exhibition business has fully recovered, and is even stronger in the second half of the year. In the first half of 2023, the company took advantage of the momentum and hosted 10 exhibitions, with a total scale of about 570,000 square meters; hosted 4 road racing events, with a total number of participants exceeding 26,000; the Shanghai World Expo Exhibition Hall operated by the company hosted 38 exhibitions and events, with a total rental area of over 5 million square meters. Major corporate projects such as the World Artificial Intelligence Conference, China International Industry Fair, and the Shanghai Marathon focus on the second half of the year, and performance is expected to maintain a high growth rate.
The integration of industry and finance continues to expand its layout, and the effects of the two major strategies are beginning to show. Through equity investment, the company continued to accelerate its strategic layout. The CMM Exhibition, Guangdong Smart Expo, and IARS Exhibition were successfully held, and synergies continued to increase. Focusing on the main exhibition business, with “Exhibition China” and “Digital Exhibition” as the two major development strategies, endogenous development and external mergers and acquisitions, are driven by two-wheel drive, and continuously enhancing the core competitiveness of the exhibition business.
Risk warning: macroeconomic downturn, IP influence weakens; strategic progress falls short of expectations.