Main points of investment
Core net profit increased by 49.2% over the same period last year, and the performance was in line with expectations: the company's operating income in 2020 was 1.73 billion yuan (the same below), an increase of 37.1% over the same period last year; among them, property management, pre-delivery and consulting, community value-added and smart solution services accounted for 45.9%, 36.0%, 7.8% and 10.3%, respectively, with diversified sources of income. In 2020, the company's core net profit was 255 million yuan, an increase of 49.2% over the same period last year, and the core net profit margin was 14.7%. The dividend per share was 69 Hong Kong cents, with a dividend payout rate of 40%, which was in line with market expectations.
The company's profitability remains stable: the company's comprehensive gross profit margin in 2020 was 30.5%, an increase of 0.5 percentage points over the same period last year, and profitability remained stable. In 2020, the gross profit margins of the company's property management, pre-delivery and consulting, community value-added and smart solution services were 26.6%, 31.3%, 49.6% and 30.6%, respectively, and the gross margin was 40.0%, 37.0%, 12.7% and 10.3%, respectively. The business structure is stable.
Transition to urban integrated service operators: as of the end of 2020, the company's managed area was 5749 square meters, an increase of 24.4 percent over the end of 2019, and the contract area was 7729 square meters, an increase of 43.7 percent over the end of 2019. Through bidding, equity cooperation, joint venture platform and other ways to expand the scale of management from third parties, covering housing, universities, hospitals, public construction, industrial parks and other forms of business, the transformation to urban integrated service operators. By the end of 2020, the proportion of the company's tube area from related parties and third parties was 50.1% and 49.9% respectively, an increase of 3.5 percentage points compared with that at the end of 2019. With the company's more active third-party expansion strategy and the increase in related party delivery, the company's managed area is expected to exceed 100 million square meters in 2021.
Our point of view: Kaisa beautiful through bidding, equity cooperation, joint venture platform and other ways of multi-dimensional expansion, actively expand the third-party market, layout of urban comprehensive services this blue ocean market, multi-format comprehensive development. In 2021, the company will adopt a more active expansion strategy to develop diversified business. After the recent market adjustment, the company's valuation is currently in a more attractive position, so investors are advised to pay attention to it actively.
Risk tips: business expansion is not as expected; property management satisfaction is reduced; property management fee collection rate is reduced; property management fee increase is blocked.
