Investment elements

The company is currently the only listed company of China Post Group, is the key scientific research and technical support unit of the national postal system, and takes the lead in the research and development of computer communication network in China. The company's main business includes software integration, GIS Beidou technology application and intelligent package cabinets.

Gradual improvement in business performance

After the company's controlling shareholder was changed from Hunan Post to China Post Capital, the new management team based on Post, highlighted the key points, and steadily promoted various businesses. At the same time, strengthen the overall planning function of the market, optimize the management process, and effectively control the cost during the period. As of the third quarter of 2016, the company's operating income reached 208 million yuan, an increase of 53.85% over the same period last year. The net profit attributed to shareholders of listed companies in the third quarter was-5.016 million yuan, a loss reduction of 2.664 million yuan compared with the same period last year, and is expected to turn losses into profits in 2016, with main business income of 244 million yuan and earnings per share of 244 million yuan.

The accelerated process of industry capitalization has forced the Postal Group to inject assets.

Domestic express industry major enterprises Shun Feng, Shentong, Yuantong, Yunda have been listed in A shares, ZTO Express has also landed on the New York Stock Exchange. EMS, the high-quality asset of the Post Group, is the only company that has not entered the capital market recently and ranks among the top five companies in the industry. under the background of the substantial increase in industry concentration, the company may become the capital operation platform of the Post Group, and the listing of EMS is expected to be restarted and injected into the company.

Profit forecast

It is estimated that the EPS of the company from 2016 to 2018 is 0.12 yuan for 0.01ax. We judge that the process of capitalization of the postal express industry is accelerated, and the accelerated degree of postal informatization will gradually improve the company's main business income. With reference to the market capitalization of similar companies and the potential market value of EMS, we believe that the company is seriously undervalued, with a reasonable market capitalization of 8 billion yuan, covering the buy rating for the first time and a target price of 50 yuan.

Risk hint

The speed of informatization in the postal industry is lower than expected or investment is lower than expected, and asset injection is lower than expected.