Events. The company publishes its semi-annual report for 2020. During the reporting period, the company realized operating income of 4.974 billion yuan, down 45.6% from the same period last year, and the net profit belonging to shareholders of listed companies was 595 million yuan, down 64.4% from the same period last year.
In the first half of 2020, the company's revenue decreased by 45.6% compared with the same period last year, as the number of projects eligible for carrying forward operating income during the reporting period decreased by 45.6%; in the same period, the company's homed net profit decreased by 64.4% compared with the same period last year.
(1) during the reporting period, the company realized an operating income of 4.974 billion yuan, a net profit of 595 million yuan attributable to the parent company, and a net profit of 366 million yuan after deducting non-recurrent profits and losses belonging to the shareholders of the listed company. During the reporting period, the interest-bearing liabilities were reduced by about 1.746 billion yuan, and the asset-liability ratio at the end of the period was 66.12%. (2) during the reporting period, the company overcame the difficulties of the epidemic and accelerated the sale and elimination. Among them, the apartment project Shanghui Haoting realized sales removal of about 88%; Binjiang Yuefu project realized sales removal of about 90%; villa project Wuxi Banshan 1 realized sales of about 24%, ranking among the top three of similar products in Wuxi; Suzhou Zhonghua Park achieved sales removal of about 22% in 19 days. During the reporting period, the company achieved a total contract area of 65300 square meters, with a contract amount of 4.428 billion yuan. (3) during the reporting period, the company launched the issuance of 10 billion corporate bonds, ensuring sufficient capital reserves for the follow-up operation of the company. At the same time, the company gathers innovative financing models such as asset securitization and annuity financing to effectively promote the CMBS financing plan and the "Beijin Institute + Dealers Association".
Combine financing plans and expand innovative financing channels.
According to the company's semi-annual report 2020, in the second half of the year, the company will continue to consolidate and deepen the three development and operation lines of residential, commercial and stock assets on the basis of ensuring the company's stable development and standardized operation, so as to further enhance its core competitiveness. forge ahead towards the strategic goal of becoming an influential real estate development enterprise in Shanghai.
Investment advice: the company's transformation is beginning to bear fruit, with a "neutral" rating. In accordance with the established strategic plan, the company has prospectively established the strategic development direction of three important product lines: housing, commercial offices and stock assets, and unswervingly focuses on the development and operation of the three product lines. At present, the company's development projects are mainly concentrated in Shanghai, radiation Kunshan, Zhenjiang, Suzhou, Hangzhou, Jiangyin, Wuxi and other key cities in the Yangtze River Delta. We estimate that the company's EPS in 2020 and 2021 will be 0.36 yuan and 0.42 yuan respectively. Considering the gradual success of the company's transformation, the company was given a dynamic PE of 9-11 times in 2020, with a reasonable value range of 3.24-3.96 yuan, downgraded to a "neutral" rating.
Risk hint: the company faces two major risks: interest rate hike and policy regulation.