The net profit of homing in 2020 achieved positive growth. The company with rapid expansion of 21Q1 revenue released its annual report and quarterly report on April 26. The revenue in 2020 was 455.8 billion yuan, + 7% compared with the same period last year. The net profit was 15 billion yuan, + 2% compared with the same period last year, which was lower than our expectation (16.3 billion yuan), but higher than the performance of KuaiBao (13.7 billion yuan) on January 21. The dividend rate was-12.73pct to 20.28% compared with the same period last year. 21Q1's revenue was 132.6 billion yuan, + 67% year-on-year, and its net profit was 3.9 billion yuan, + 7% year-on-year. We expect the company's EPS from 2021 to 2023 to be 1.40,1.65,1.93 yuan, with a target price of 7.84 yuan, maintaining a "buy" rating.
The real estate business remains stable, and the infrastructure business expands rapidly.
In 2020, the carry-over income of the real estate business was + 0.2% compared with the same period last year, and the revenue from infrastructure business was driven by the rapid growth of construction projects in Guangxi and the amount of newly signed contracts + 24% compared with the same period last year. The growth rate of homed net profit is lower than that of revenue, mainly because: 1, the gross profit margin of real estate business is from-1.2pct to 26.4% year-on-year, and the increase in the share of revenue from infrastructure business with low gross margin leads to the overall gross profit margin year-on-year-1.1 PCT-2 and investment income-46% year-on-year. The continued expansion of 21Q1 infrastructure business led to high revenue growth, but the overall gross profit margin year-on-year-3.7pct dragged down the growth of homecoming net profit.
21Q1 contract liabilities relative to 2020 real estate revenue coverage of 227%, ample resources to be carried forward.
Housing sales are growing, and the quality of expansion will be further optimized.
The epidemic in 2020 led to the postponement of some of the company's projects and hindered the elimination of commercial projects, with sales of 358.4 billion yuan,-8% of the same period last year. But the quality of sales has improved steadily: residential sales are + 8 per cent year-on-year and the payback rate is + 8pct to 86 per cent year-on-year. 21Q1 sales rebounded from a low base, with sales area and amount + 39 per cent year-on-year. Driven by the goal of reducing debt, the company controls the strength of land acquisition, but the proportion of equity in the amount of equity has increased to more than 90%, the proportion of new goods in the first and second lines has increased, and the proportion of new residential buildings has been maintained at 70%, and the quality of expansion has been optimized. By the end of 2020, the company's total land reserve was + 12% to 201 million square meters compared with the same period last year.
Reducing debts and achieving practical results, looking for opportunities in the face of crisis in diversified industries
The company continues to promote the "three-year and three-step deleveraging" plan, and strives to achieve the goal of "turning green" on two lines by 2021. By the end of 21Q1, the coverage rate of short-term debt has reached the standard; the net debt ratio is higher than the 2020 high-52pct; the asset-liability ratio excluding accounts received is higher than that of the end of 2020-1pct; and the total interest-bearing liabilities is 84.5 billion yuan lower than the 2020 high. The net cash flow of the company's operating activities improved significantly, becoming a regular employee in 2020 compared with the same period last year with + 132% Personality 21Q1. The company's financial, consumer and other comprehensive industries are looking for opportunities in crisis, and the scale of business has expanded steadily.
Effective debt reduction and maintenance of "buy" rating
With reference to the company's annual report, we increase the revenue of infrastructure business and reduce the revenue of real estate business and gross profit margin. It is estimated that the company's EPS for 21-23 years will be 1.40,1.65,1.93 yuan (1.67,2.05 yuan before 21-22 years).
Comparable company's 21-year average PE is 6.2times (Wind consensus expectation). Considering that the company's diversified business capital accumulation is likely to magnify the impact of debt reduction on the company, we think that the company's 21-year reasonable PE is 5.6x, the target price is 7.84RMB (the previous value is 8.98RMB), and the "buy" rating is maintained.
Risk tips: epidemic situation, capital chain, real estate policy, downside risk of real estate market.