Iron ore: harvest in 2011. The company has a 100% stake in Shenlong Mining, with proven iron ore reserves of 109 million tons and an average geological grade of 30.55%. The first phase of 1 million tons / year raw ore has been put into trial production on July 19, 2010. we estimate that the output of iron concentrate in 2011 will be about 30, 000 tons, and that in 2010 and 2012 will be 220000 tons and 300000 tons respectively.
Through comparative analysis, we think that the iron ore resource value of Chuangxing Real Estate is obviously underestimated. Through the asset value evaluation, we get that the connotative value of iron ore assets is 14.63 yuan, and the fluctuation range of the connotative value of iron ore is 12.59 yuan-19.75 yuan.
Real estate gains stable investment returns. At present, there are two real estate businesses: one is the Shanghai Xiagong Real Estate Company, a wholly-owned subsidiary of the company, and at present, there is also the closing stock of Oriental Hawaii; the other is the Shanghai Zhenlong Real Estate Company, in which the company shares 39.93%, mainly developing the Oasis Cannes project, which has been completed in about 5-6 years. Oasis Cannes is expected to contribute 85 million yuan, 80 million yuan and 202.4 million yuan to investment income from 2010 to 2012, respectively. The company's real estate projects contributed 0.46 yuan, 0.36 yuan and 0.93 yuan per share respectively from 2010 to 2012.
Give a recommendation. We expect the company's operating income from 2010 to 2012 to be 100.86 million yuan, 221.5 million yuan and 365.5 million yuan respectively, and earnings per share to be 0.5,0.77 yuan and 1.48 yuan respectively. Combining the asset value revaluation method and the PE valuation method, we think that the reasonable value range of the company is 21.75-25.15 yuan.
Taken together, we believe that the value of the company's iron ore resources has not been fully recognized by the market, and the focus is on the iron ore business after 2011, while real estate can provide stable investment returns. To give a recommended rating, it is recommended to pay positive attention.
