Incidents. The company published its 2023 annual report. During the reporting period, the company achieved revenue of 1,032 billion yuan, up 17.04% year on year; net profit attributable to shareholders of listed companies was 99 million yuan, up 1.85% year on year; net cash flow from operating activities was 644 million yuan, up 10.57% year on year; and the company distributed a cash dividend of 2.20 yuan (tax included) for every 10 shares to all shareholders.
The main reason for the increase in the company's revenue in 2023 is mainly due to mergers and acquisitions and increased revenue during the climbing period.
The main reason for the increase in the company's net profit attributable to mother in 2023: In accordance with the provisions of the new leasing guidelines, confirmation of the termination of use-rights assets and lease liabilities associated with the project led to an increase in asset disposal gains and losses.
According to the 2023 annual report, the company's business model mainly includes leased operation, shareholding operation, and fiduciary operation. By the end of 2023, the company had 42 leased and operated projects, and the property area available for rental operation was about 770,000 square meters. The company has been commissioned to operate 29 projects, and the property area that can be rented and operated is about 520,000 square meters. The company has participated in 2 projects, and the property area that can be rented and operated is about 100,000 square meters.
By the end of 2023, the company had 73 projects under management, with an area of about 1.4 million square meters. The overall number and area of projects were in a leading position in the industry. By region, there are 61 projects in Shanghai, 9 in Beijing, 2 in Hangzhou, and 1 in Nanjing.
Investment advice: Benefit from the advantages of urban and village policies in megacities, with a “superior to the big city” rating. The company is an asset-light service company. Its main business is the positioning design, renovation, investment, operation and service of old urban properties and inefficient commercial properties.
We expect the company's 2024-2025 EPS to be about 0.28 yuan and 0.36 yuan. According to the statistics bureaus in Shanghai and Beijing, by the end of 2003, the total completed area of office buildings, shopping malls and other non-residential houses in the two places was about 80 million square meters. Excluding that some projects have been upgraded, there is still plenty of room for renovation. However, the properties managed by the company are mainly located in the core locations of first-tier cities such as Shanghai and Beijing, which will fully benefit, because we will give the company a dynamic price-earnings ratio of 18-22 times in 2024, corresponding to a reasonable value range of 5.04 yuan to 6.16 yuan, maintaining a “superior to the market” investment rating.
Risk warning: risk of falling occupancy rates and rent differences; risk of excessive regional concentration.