Incidents:
On May 13, 2024, Ka Shing International issued an announcement:
Jiacheng International won the bid for Shein (Shein) for the fourth time this year. As a quality inspection outsourcing project, the company further expanded the scope of business services provided to Xiyin. Based on the full fiscal year, the company expects the annual revenue generated by the contract to exceed 10% of the company's audited revenue in 2023.
Investment highlights:
It has continuously won bids for Xiyin's contracts, and the growth logic continues to implement Jiacheng International's bid project to provide quality inspection outsourcing services for Shein (Shein). This is the fourth time this year that the company has won the bid for Xiyin's contract. The full-link service model of cross-border e-commerce provided by Jiacheng International has been fully recognized by cross-border e-commerce platform companies, and the company has also expanded its business service content. The company expects the contract to generate more than 10% of the company's audited revenue for 2023. As of May 13, 2023, the company has successively won several major contracts, and the growth logic continues to be fulfilled. It is expected that 2024 results will usher in rapid growth.
Seize the dividends of cross-border e-commerce and be optimistic about the company's growth attributes
In 2023, the company made a major breakthrough in cross-border e-commerce logistics business, and the Jiacheng International Port Park was fully used for the overseas business of world-renowned cross-border e-commerce platform companies. By the end of 2023, the company had provided nearly one million square meters of warehouse services to the world's four leading platform companies. In addition, the Jiacheng International (Hainan) multi-functional digital intelligence logistics center (estimated total area of 213,300 square meters) planned by the company has completed capping work and is about to be completed and put into use. The company grasps the dividends of cross-border e-commerce, rapidly removes new production capacity and contributes to increased performance, and continues to be optimistic about the company's growth attributes.
Profit forecast and investment rating We expect Jiacheng International's revenue for 2024-2026 to be 1,530 billion yuan, 1,757 billion yuan and 1,960 million yuan respectively, net profit to mother of 281 million yuan, 325 million yuan and 375 million yuan, respectively. The corresponding PE for 2024-2026 will be 14.93 times, 12.91 times, and 11.19 times, respectively. The cross-border e-commerce logistics boom is rising, and the rapid removal of new production capacity contributes to growth. The 2024 performance is expected to usher in significant growth, maintaining the “increase” rating.
Risks indicate risks caused by unstable international trade situations; cross-border e-commerce falling short of expectations; overseas policy risks for cross-border e-commerce; risks of falling short of expectations in warehouse operations; risk of warehouse capacity utilization falling short of expectations; risk of fluctuating sentiment in industries such as home appliances; and information system risks.