Passenger transport leader on the island, the recovery of automobile business is imminent: SAIC has been engaged in the industry for many years, focusing on automobile passenger transport, passenger station operation, automobile integrated services and other businesses. Calculated in terms of highway passenger volume, SAIC achieved 26.73 million highway passenger traffic in 2021, with a market share of 55.0% on the island. With the adjustment of prevention and control policies, the recovery of urban passenger flow represented by Sanya and Haikou is relatively ideal. The passenger flow into Hong Kong at the airport in the two weeks before and after the Spring Festival was 545600 and 563200 respectively, returning to 101.68% and 92.69% of the level of the same period in 2019, respectively. Improvement on the demand side is expected to lead to the release of business profits.
Sea travel tax exemption is small and beautiful, differentiated operation guarantee follow-up profitability: sea travel tax exemption focuses on cost-effective model, the discount is relatively large (there have been 30% discount activities in the past), and the annual market share of 2022Q1 under the high discount strategy has increased to 7.5% from 3.5% in 2021. From the perspective of location, the sea brigade duty-free city is adjacent to the ancient situation of Sanya, cooperates with the high market share of sea and automobile passenger transport business, and effectively captures price-sensitive customers such as group passengers and individual passengers. In terms of investment promotion, sea travel duty-free focuses on the long tail market, laying out some minority brands. According to the announcement of Haiqi Group, the proportion of sea travel duty-free procurement since Lagerdale has dropped to 72.5%. Then continue to increase the volume of the brand, and the improvement in gross profit margin is expected to drive profit release.
Suspension of financial data due has no significant impact on the company's fundamentals: on January 19, 2023, SAIC announced an application for suspension of share issuance and payment of cash to purchase assets and raise matching funds. The reason for this suspension is that the relevant financial data is about to expire and the relevant financial data need to be audited; in addition, there are still relevant matters that need to be further improved and implemented, so it is not expected to submit a feedback reply within the specified time. This suspension is the normal administrative license implementation procedure of the CSRC, and we do not think it will have a significant adverse impact on this reorganization.
Investment advice: sea Travel duty-free city is in a period of rapid growth, superimposed automobile transport business recovery is expected to ensure the basic level of passenger flow, we think that the follow-up profit release may be ideal. From 2022 to 2024, we estimate that the company will achieve a homed net profit of 0.43 million yuan, respectively, corresponding to PE 210.0, 127.5, and 85.8 X, respectively; based on the asset injection, we estimate that 2022, 2023, and 2024 will achieve a net profit of 1.635.21 / 775 million, respectively, corresponding to PE 138.1, 43.2 and 29.0 X, respectively. Cover for the first time, giving a "buy" rating.
Risk tips: tax-free sales on outlying islands are not as expected; passenger flow in Hainan is not as expected; progress in asset injection is not as expected.
