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彩生活(1778.HK):增值服务略有下滑 京东+360协同未来可期

Color Life (1778.HK): a slight decline in value-added services JD.com + 360Collaborative Future

興業證券 ·  Aug 27, 2019 00:00  · Researches

2019H1 performance overview: 2019H1, the company's main revenue reached 1.811 billion yuan, an increase of 3% over the same period last year, gross profit of 590 million yuan (2018H1:6.2 billion), net profit of 216 million yuan, an increase of 23.15% over the same period last year. Among them, the income from property management business increased by 3% to 1.51 billion over the same period last year, accounting for 83.38% of the total income, the income from value-added services decreased by 5.6% to 200 million compared with the same period last year, accounting for 11.04% of the total income, and the income from engineering services increased by 29.5% to 100 million over the same period last year, accounting for 5.52% of the total income.

Value-added services due to the adjustment of the product structure of Caifu Life + office building grouping business was transferred to a joint venture, which fell short of expectations. In the first half of 2019, the company's value-added service revenue of 200 million (YoY-5.6%) was mainly due to Caifu Life's initiative to shrink the scale of P2P wealth management products, with a GMV of 530 million (YoY-65%) in the first half, resulting in a 15% decline in online promotion services. In addition, sales and leasing assistance decreased by 5.5% to 91.83 million compared with the same period last year, mainly due to the shift of office building grouping business to joint venture and the development of Caixian parking space business.

The area increased further and the output of the platform continued to appear. As of 2019H1, the company's platform service area has reached 1.206 billion square meters, of which the contract management area has reached 560 million square meters, and the cooperation and alliance area has reached 642 million square meters. The number of communities with management and consulting service contracts reached 2824, an increase of 10.5 per cent over the same period last year. Among them, the total construction area of contract management that has generated revenue has reached 365 million square meters, and the number of communities has reached 2295. The platform effect has been further revealed, and the leading advantage of the online platform has been continuously strengthened.

With the introduction of JD.com and 360 shares, the synergy effect is expected in the future. In July 2019, JD.com and 360th held 5% and 3.05% shares respectively through a private placement. In the future, Cai Life will cooperate with JD.com in community new retail, front warehouse setting, logistics and distribution, platform experience optimization, and so on.

At the same time, based on 360's technical accumulation in the core security field, it will cooperate with it in the field of security.

Investment advice: we are optimistic about the company's huge user traffic and Internet thinking, but due to the limited policy impact of value-added business revenue, we have reduced the company's 19-21 revenue from 45-51-58 million to 40-43-46 billion, reduced the company's parent net profit to 5.8 hundred million, adjusted the target price to HK $5.77 million based on the DCF model, and maintained a "buy" rating with a 19-year EPS of 11.8 times.

Risk tips: 1) the new model and strategic cooperation are not as expected; 2) the uncertainty of value-added service project expansion

The translation is provided by third-party software.


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