The first A-share listed interior design company, with plentiful orders to guarantee future performance growth
Jayne Design was founded in 2004, and the company was listed on the Shenzhen Stock Exchange in 2017, becoming the first interior design company to land on A-shares. The company's brand advantage is remarkable. In the 2019 ranking of global design giants in the authoritative US magazine “INTERIOR DESIGN”, it ranked 25th overall in the world. Among them, commercial design ranked third in the world, number one in Asia and number one in China. The company's revenue growth rate showed an upward trend year by year. In 2018, the company achieved revenue of 330 million yuan, a year-on-year growth rate of 32.22%; during the same period, the net profit of the mother was 81.79 million yuan, a growth rate of 31.39%, which maintained a high growth rate for four consecutive years. By the end of 2018, the company had about 1,187 million orders in hand, or 3.59 times the amount received in 2018. Good enterprise management mechanisms further promoted the gradual implementation of orders, thereby ensuring steady growth in future performance.
Consumption upgrades drive the company's steady growth in the medium to long term, and the company's brand advantage is expected to gradually increase
With the upgrading of consumption, upgrading of aesthetic capabilities and requirements, the increase in demand for high-end design, and the gradual opening of upgraded interior design business space in the stock market, the overall market capacity of the company's industry will continue to grow, and the brand advantages of leading design companies represented by the company may gradually increase, thus gradually concentrating market demand on leading enterprises.
In the current context of strong economic downturn pressure, the central government gradually stepped up efforts to repair shortfalls in infrastructure in the second half of 2018, which had a certain driving effect on infrastructure-related interior design. The company's share of interior design in non-real estate-related fields such as infrastructure and healthcare has gradually increased in recent years, thereby enhancing the profitability and resilience of the company's business portfolio. In particular, the interior design business field related to urban rail transit has grown significantly.
Build a cutting-edge operation and management platform to stimulate enterprise vitality, and the company's growth value is extremely high under the “big industry and small company” pattern
The company has established a project-based operation management system with project management as the core of management and a self-developed enterprise operation management platform (ERP) and the like as the operating carrier, providing a convenient and efficient technical environment for internal operation and management, helping the company transition from the traditional “relying on individual” model to a more mature “dependent system” model, thus further stimulating enterprise vitality. The financing advantages of the first listed local design company are expected to strengthen the company's ability to innovate management models and continue to improve efficiency.
We believe that under the current “big industry and small company” pattern, enterprises with real management model innovation are expected to form strong endogenous growth, thereby smoothing the impact of cyclical fluctuations in the industrial chain. Furthermore, the accumulation of project experience brought about by high growth will in turn strengthen the company's brand advantage and form positive feedback. It is recommended to focus on the company's growth value.
Investment advice
As the only A-share listed company in the architectural interior design industry, the company has strong brand influence and there are plenty of on-hand orders. The balanced layout of real estate and infrastructure-related interior design will enhance the profitability and resilience of the company's business portfolio. Furthermore, the company's management model has significant advantages over other companies in the same industry, and it is recommended to pay attention to the company's high growth value. The company's revenue for 2018-2020 is estimated to be 326, 431, and 579 million yuan respectively, net profit of 0.81, 101 and 128 million yuan, and EPS from 2018 to 2020 is 0.77, 0.96, and 1.22 yuan/share; if the closing price of March 15, 2019 is taken, the corresponding PE is 27, 22, and 17 times, respectively. We are optimistic about the company's development and give it a “buy” rating. The target price is 30.20 yuan/share.
Risk warning: The growth rate of fixed asset investment is declining at an accelerated pace, and the impact of real estate policy regulation on the company's related business exceeds expectations
