Chuanhua Zhaopin: light and heavy assets are matched to help supply chain services, and future performance growth is expected. Chuanhua Zhaopin was established in 2001 and listed in 2004. in 2015, Chuanhua Group injected its logistics resources into listed companies. Chuanhua Zhaopin adjusted its development strategy and completed the transformation of emphasis from chemical industry to intelligent logistics. began to build Chuanhua network intelligent logistics business as the primary development goal, and coordinate the development of chemical business. As of July 29, 2021, the company has a total market capitalization of more than 21 billion yuan and total assets of more than 35 billion yuan.
Growth track: China's logistics market has trillion-level space to improve quality and efficiency, and the digitization of road freight transport is one of the important links. 1 Industry trend: the proportion of logistics costs in China is higher than that in developed countries, and the logistics market has trillion yuan and room for quality improvement and efficiency improvement. In 2020, China's logistics cost was 14.9 trillion yuan, accounting for 14.6% of GDP. From the perspective of the United States (8%), if the logistics industry is promoted to improve quality and efficiency through a series of specialization and digital measures, assuming that the proportion is 12%, China's logistics costs have room for a trillion-level decline. 2 ideal vision: from third-party logistics to digital supply chain, the market demand of subdividing industry is broad. Supply chain management helps enterprises to reduce costs by 5% and 15%. By 2025, the supply chain service market of automobile and fast consumer logistics will exceed 400 billion yuan, and the supply chain market of clothing and electronic logistics will exceed 300 billion yuan. 3 hot links: highway network freight transport is an important part of the digital supply chain. The core of the network freight platform is to integrate resources and resolve the information asymmetry between shippers and social scattered drivers. At present, the market concentration of China's network freight industry is relatively high, but under the background of network data security review, the road network freight market pattern is facing reconstruction.
Core business: logistics business is the future performance growth point, policy support is sustainable. 1 Highway port business: physical network is used to integrate industry resources to promote the development of supply chain. 2 supply chain logistics service: focus on four major industries and carry out "warehouse transportation and distribution" services. 3 Network freight platform service:
Provide tax optimization and car matching services to solve the pain point problem of road freight transportation. 4 supply chain financial services: take advantage of offline and online platform data to carry out a series of factoring and financing services. 5 after-car service: give full play to the aggregation effect of the highway port, and the revenue scale remains stable. 6 chemical business: fine chemical "start" business, stable management capacity. 7 Policy factors: grasping the trend of national logistics upgrading policy, obtaining government subsidies is sustainable.
Profit forecast and valuation: the EPS of the forecast company from 2021 to 2023 is 0.68,0.77,0.86 yuan, corresponding to PE is 11 times, 9 times, 8 times. Maintain a "recommended" rating.
Drivers, key assumptions and key forecasts:
Short-term driving factors: 1 under the epidemic situation of COVID-19, China's road freight and other logistics continue to maintain a high demeanor. According to data from the China Federation of Logistics and Purchasing, in the first half of 2021, the national social logistics totaled 150.9 trillion yuan, an increase of 15.7 percent year on year at comparable prices, with an average growth rate of 7.3 percent in two years. According to data from the Ministry of Transport, from January to June 2021, China completed commercial freight transport of 24.75 billion tons, an increase of 24.6 percent over the same period in 2020 and 14.9 percent over the same period in 2019.
To benefit the highway port, network freight transport and supply chain logistics business of Chuanhua Zhaopin, the performance is expected to show significant marginal improvement. 2 Full Truck Alliance Co. Ltd. and other leading enterprises in the network freight industry are currently subject to national network data security review, the network freight market pattern is facing the trend of restructuring, and Chuanhua Zhaopin is expected to gain incremental market share.
Long-term driving factors: China's logistics market has trillion-level space to improve quality and efficiency, and the digitization of road freight transport is one of the important links. In 2020, of the total cost of 14.9 trillion yuan of social logistics in China, the scale of outsourced logistics (third-party logistics) is 6.5 trillion yuan, accounting for 43.9%. The scale of integrated supply chain logistics is 2.3 trillion yuan, accounting for more than 30% of the third-party logistics. The penetration level of China's third-party logistics and supply chain has room for further improvement.
Our view is different from that of the market:
The subsidy policy for the upgrading of logistics industry is sustainable. Chuanhua Zhaopin to carry out intelligent logistics, highway port logistics center and other business has a certain public service attribute. Specifically, it can be understood that the government buys public services, and Chuanhua Zhaopin is providing corresponding services. at present, various types of financial subsidy funds in our country every year have a strong persistence, therefore, in the future, Chuanhua will still do a good job in the logistics market demand and logistics public service products concerned by the government, and it is sustainable to get government subsidies.
Valuation and investment advice:
According to the results of performance split and profit forecast, the company is expected to achieve operating income of 29.781 billion yuan, 39.225 billion yuan and 46.611 billion yuan respectively from 2021 to 2023, which is + 38.54%, + 31.71% and + 18.83% respectively compared with the same period last year. From 2021 to 2023, the company is expected to achieve a net profit of 20.73,23.63 and 2.638 billion yuan respectively, which is + 36.32%, + 13.94% and + 11.62% respectively compared with the same period last year. From 2020 to 2022, EPS is expected to be 0.675 yuan per share, 0.769 yuan per share and 0.859 yuan per share respectively, corresponding to 11 times, 9 times and 8 times PE. At present, the company deepens the digital process of recommended logistics, deeply promotes the integrated development of highway port and network freight platform, and steadily promotes the supply chain logistics business, the company's valuation should take into account the comprehensive valuation level of logistics real estate, network freight platform and integrated logistics, and there is room for improvement. In the future, the company will usher in a situation of simultaneous increase in valuation and performance, and maintain a "recommended" rating.
Absolute valuation: we use the three-stage FCFF model for absolute valuation. Taking into account the high growth of online freight and road freight digitization, the transition period is assumed to be seven years, from 2024 to 2030. Based on the steady growth of the road logistics market in the future, it is assumed that the growth rate in the transitional period from 2023 to 2027 will be 7%. After 2030, it will be a period of sustainable growth, and it is assumed that the sustainable growth rate will be 1.5%. At the same time, we estimate that the company β is 1.02 and the WACC is 4.98%. Based on the above parameter assumptions, we estimate that the target price per share of the company is about 10.92 yuan.
Catalyst for stock price performance:
The highway network freight transportation high growth development, the digital supply chain permeability enhancement, the highway freight transportation high scene demeanor development and so on.
Main risk factors:
The risk that the logistics demand is lower than expected, the logistics digitization process is not as expected, the COVID-19 vaccination schedule is not as expected, the risk caused by the transportation policy change, the risk of the policy change of the network freight platform.