Shanghai Port Group (600018): faster-than-expected growth in performance Concerned about the new zone policy of the Free Trade Zone

Shanghai Port Group (600018): faster-than-expected growth in performance Concerned about the new zone policy of the Free Trade Zone

The 1H19 performance exceeded our expectations for the first half of 2019, which was announced by the company: revenue of $ 17.2 billion, a year-on-year decrease of 1.

8%; net profit attributable to mother 43.

73 ppm, corresponding to a profit of 0.

19 yuan, an annual increase of 29% (net profit increases by 9 each year.

8.7 billion), exceeding our budget expectations (an increase of 11%).

The decrease in revenue was mainly due to the decrease in increase in settlement income from real estate business2.

170,000 yuan, the real estate business (Long Beach project) in the first half contributed 52.4 million yuan in revenue, 1 year earlier.

3.6 billion.

As for the main port business, the container explosion in Shanghai’s home port has grown5.

0% (4 in the same period last year.

6%), as the company took the initiative to adjust the loading and unloading business of ore and coal, the bulk cargo explosion dropped by 18%.

5% reduction of total cargo tungsten carbide 1.

9%.

The total of the three expenses is reduced by 2.

110,000 yuan, mainly due to a significant reduction in financial expenses of 31% after early repayment of loans.

The company’s wholly-owned Shanghai Hong Kong Football Club realized a year of 武汉夜网论坛 losses (1H19 profit 0.

78 ppm, due to the introduction of foreign aid in the same period last year.

67 ppm), which is a preliminary (club net profit increase) 4 that our performance growth exceeded our expectations4.

4.5 billion accounted for 45% of the total net profit increase).

Development Trend The container explosion is growing moderately, and the uncertainty comes from external demand and trade negotiations. Pay attention to the free trade zone policy.

In the first half of this year, the company’s container bombs continued to grow moderately, mainly benefiting from the capacity of the automated terminals in Yangshan Port. Looking forward, the potential weakness of external demand may lead to growth, and the progress and results of trade negotiations will also bring uncertainty.

At the meeting of the Leading Group for Promoting the Integration Development of the Yangtze River Delta in June this year, it was clearly proposed to speed up the construction of the new area of the Shanghai Pilot Free Trade Zone. We recommend paying attention to the impact of relevant policies on the company.

Financial real estate and other businesses increased diversified income.

Finance: 1H19 came from Bank of Shanghai, and the investment income of Postal Savings Bank increased by 21% and 15%, accounting for 17% and 33% of net profit.

Real estate: The company still has the Long Beach project (estimated investment of 18.5 billion US dollars) and the military industry road project (estimated total investment of 82).

700 million US dollars, the military industry road project is under construction and has not yet begun sales. It is expected that it will continue to contribute profits to the company in the future.

Earnings forecasts and estimates Taking into account the high base in 4Q19 (mainly from the one-time gain from the sale of Star Bund Company), we expect earnings to be replaced.

According to the company’s annual shareholders’ meeting, the company’s budget for 2019 net profit is 9 billion US dollars, a year-on-year decrease of 12.

5%.

We maintain our 2019 net profit forecast of RMB96.

10 ppm and 2020 net profit, forecasting RMB 98.

7.7 billion.

The current priority is 17.

6 times 2019 P / E ratio and 17.

1x 2020 P / E ratio.

Maintain Outperform rating and 9.

Target price of 12 yuan, corresponding to 17.

6 times 2019 P / E ratio and 17.1x 2020 price-earnings ratio, compared with the recent merger of 25.

3% upside.

The risk surge grew faster than expected, and the settlement progress of the real estate business exceeded expectations.