Overview of events
The company announced on January 22 that it had received a confirmation letter of 2021 from Xiamen Aviation Technology Management Department. the details are as follows: according to the "2020 airline Transportation pilot overall course Flight training entrustment contract" signed by Dongfang Fashion Aviation School and Xiamen Airlines in July 2020, Xiamen Airlines is scheduled for the period from January 1, 2021 to December 31, 2021. The total number of flight training trainees sent to Dongfang Fashion Aviation School in batches is expected to be 7, the total number of training is expected to be 246, and the total amount of training is expected to be 190 million yuan.
On January 19, the company announced that the total amount of shares to be repurchased is 150-300 million yuan for the employee stock ownership plan, and the repurchase price does not exceed 27.87 yuan per share. At this price, the number of repurchased shares is expected to be about 10.76 million shares, accounting for 1.76% of the company's total share capital. On January 20, the company announced that it had repurchased a total of 11.83 million shares, accounting for 1.94% of the company's total share capital, and the total amount paid was 157 million yuan.
Analysis and judgment:
Aviation school orders bring new growth points: from the perspective of domestic growth trend, with the maturity of domestic flight training technology and facilities, especially affected by the epidemic this year, the demand for foreign flight training orders continues to return to China. Oriental Fashion now has room to improve the utilization rate in addition to meeting Xiamen Airlines orders, so the future aviation school order growth is considerable. It is estimated that the gross profit margin of the navigation business can reach 2530%, and the net profit margin was 15.2% in previous years, and there is still room for improvement in profitability such as the end of the depreciation period.
Share buyback shows confidence in development: the company buys back A shares with its own funds and uses it to implement the employee stock ownership plan, which is conducive to further establishing and improving the incentive and restraint mechanism, enriching incentive measures, retaining core talents, and improving corporate governance structure. build a community of interests and mobilize the enthusiasm of the backbone.
Investment advice:
We analyze that the recent decline of the company is mainly affected by the linkage of beautiful home ownership, and some of the investment companies owned by major shareholders have positions, but they have nothing to do with fundamentals.
Focus on the continuous recovery of Beijing and the turnaround of remote schools in the past 21 years; VR is expected to bring cost reduction and realize the expansion model of remote light assets; aviation school training, Shandong and Wuhan subsidiaries and testing stations are expected to become new growth points, so the 21-year performance is expected to be more flexible. In addition, the company is the first driving school to resume full training and provide full tests after the epidemic, which is expected to accelerate industry integration. Considering the impact of the epidemic in 20 years, but the new growth brought about by orders for aviation schools in 21 years, the income of 2020-22e was changed from RMB 9.51 billion to RMB 1.2900 million to RMB 8581.490 million, with a growth rate of-23%, 74%, 17%, respectively, and the net profit of home ownership was changed from RMB 229 million to RMB 211,359 million, with a growth rate of-50%, 140%, 24%, respectively, to maintain the holding increase rating.
Risk hint
The risk of declining business performance caused by the epidemic; the risk of impairment of goodwill; the risk of pending litigation; systemic risk.