Main points of investment:
With the rapid growth of revenue and profit scale, the core business rebounded in the first half of 2021. Shenzhen International announcement shows that in the first half of 2021, with the effective control of the domestic epidemic situation, the company's main business recovered in an all-round way. The company's total revenue in the first half of the year was HK $7.29 billion (the same below), an increase of 66 per cent over the same period last year. Excluding revenue from toll road construction services, the company's total revenue in the first half of the year was 7.06 billion yuan, an increase of about 100% over the same period last year.
In terms of business, in the first half of 2021, the company's core logistics business revenue recorded 2.224 billion yuan, an increase of about 37% over the same period last year, accounting for about 31% of the company's total revenue (excluding revenue from toll road construction services). Its Shenzhen Expressway revenue recorded 4.838 billion yuan (mainly toll roads and environmental protection business), a year-on-year increase of 154%, accounting for about 69% of the company's total revenue.
Judging from the company's performance in recent years, the overall income and profit level has maintained a relatively good growth rate. Despite the impact of the epidemic in 2020, many of the company's businesses were significantly affected, but the overall performance was still relatively sound. In 2021, the company's core business has fully recovered and returned to the growth track.
The toll road business is growing steadily, and the great environmental protection business has great potential.
Toll road business is one of the traditional core businesses of Shenzhen International, mainly through Shenzhen Expressway (600548 SHB00548.HK), which has a stake of 51.56%. In addition, the company's large environmental protection business (mainly including solid waste recycling, clean energy, etc.) is also carried out through the deep highway.
In terms of the prospect of toll road business, we believe that the company's revenue from this business will show a steady growth trend in the future. its growth is mainly driven by: 1, the growth of the overall traffic flow of toll roads; 2, through new construction, acquisition and other ways to add new toll road lines.
The company's large environmental protection business has great potential for future growth, especially in the field of clean energy. We believe that with the support of various policies, the clean energy industry represented by wind power and photovoltaic will continue to grow rapidly in the next few years, and the company's clean energy business is expected to continue to grow rapidly in the future, with broad space for medium-and long-term growth.
The foundation and core of the company's logistics business is to innovate the business model of "investment, construction and management" and promote the business value of logistics park to accelerate the realization of logistics park and integrated logistics port business (collectively referred to as logistics park business). At present, the company has realized the layout, managed and operated 26 logistics projects in 30 logistics node cities across the country, and the total land area owned and planned is about 7.5 million square meters, of which the acquired land area is about 5.07 million square meters. The operating area is about 2.78 million square meters.
"Investment and financing management" is an innovative business model that the company has actively expanded its logistics park business in recent years. Its characteristic is that during the operation of the project, by means of asset securitization, the project rights and interests are put into the corresponding fund to achieve capital recovery and project value increment. at the same time, the company still provides follow-up operation and management services for the project and obtains the corresponding income. The Nanchang integrated logistics port project, the first project of the company's "investment and financial management" model, has been successfully implemented in the first half of 2021. After the implementation of the project, the asset appreciation rate is about 64%, and the profit attributable to shareholders is about HK $175 million for the company, and the operation and management service fee income can continue to be obtained in the future.
We believe that, on the one hand, the company's innovative business model of "investment, construction and operation" can make up for the long investment payback period of the traditional "investment, construction and operation" mode, and realize the rapid recovery of project investment. increase the company's cash flow and reduce the company's overall debt ratio, on the other hand, it is also an important way to realize the asset value-added income of the company's logistics park and comprehensive logistics port. On the whole, we believe that the continuous practice of the company's "investment, construction and financial management" model will help to promote the overall value enhancement and value realization of the company's logistics park business, and is an important supplement to the company's traditional investment and operation mode.
With the rapid progress of the transformation and upgrading of the logistics park, the project value is expected to continue to release the company to seize the good opportunity of urban renewal in Shenzhen in recent years, actively promote the functional adjustment and transformation of the original land of its logistics park, vigorously expand the transformation and upgrading of the logistics park, and build a large closed-loop model of "investment, construction and management" for the logistics park business, which has made considerable progress.