Divine High Speed Rail (000008) Research Briefing: Development of trillion space companies in rail transportation and maintenance market is worth looking forward to

Divine High Speed Rail (000008) Research Briefing: Development of trillion space companies in rail transportation and maintenance market is worth looking forward to
The company is a leader in underground rail transportation operation and maintenance industry.The company has completed the layout of China’s only vehicle, line, signal, power supply and station five professional operation and maintenance equipment for the entire industrial chain platform; currently covering more than 400 rail transportation operation maintenance products for high-speed rail, ordinary speed, and urban rail.In November 2018, the company joined the SDIC Group, providing the company with strong capital and platform support.In the end, the company successively laid out projects such as Taizhou regional railway line S1, Hangzhou-Shaoxing-Taiwan high-speed railway, Tianjin subway line 7 and Tangshan Port freight railway. The company drove the entire line of operation and maintenance services through a small amount of investment. The intelligent operation and maintenance of the entire line gradually progressed:.On January 9, 2019, the company’s newly signed contracts were US $ 2.4 billion, an increase of 31% year-on-year, and the newly signed contracts continued to grow rapidly.At present, the company is transforming from an operation and maintenance equipment supplier to a complete line of intelligent operation and maintenance service providers. In 2019, the company’s business composition includes traditional equipment, intelligent equipment, and operation and maintenance, which accounted for 62%, 13%, and 19% respectively; company planningAfter five years, the operation and maintenance is equivalent to the equipment business. The intelligent equipment in the equipment business is equivalent to the traditional equipment. In the future, the proportion of the operation and maintenance and intelligent equipment business will continue to increase. Operating performance has grown steadily, profitability has continued to improve, and cash flow has improved.In the first three quarters of 2019, the company achieved revenue of 15.6 ppm, an increase of 21 in ten years.0%; net profit attributable to mother 1.50,000 yuan, an annual increase of 20.1%; net profit after returning to the mother after deduction of 1.30,000 yuan, an increase of 10 in ten years.5%; the company’s operating performance achieved steady growth.In the first three quarters, the company’s gross profit margin reached 53.3%, an increase of 4 per year.7pct; net margin is 10.1%, reduced by 0 every year.1pct; ROE is 2.1%, a year to raise 0.3 points; the company’s overall profitability has increased.In the first three quarters, the company’s net cash flow from operating activities was -1.9 ‰, an increase of 7 per year.0 million yuan, although the cash flow is still negative, but sometimes greatly improved.In the 佛山桑拿 future, the company will transform into an intelligent operation and maintenance service provider, and its cash flow is expected to continue to improve. After the rail transportation operation and maintenance market enters the golden development period, the trillion market space is worth looking forward to.According to the development experience of the international railway junction industry, the market capacity of the operation and maintenance market is greater than vehicle manufacturing and engineering construction, and the future market space for the entire line operation and maintenance service industry is huge.According to the data released by the Shenzhou High-speed Railway, the railway: the railway operating mileage will reach 200,000 kilometers in 2028, of which high-speed rail 4.50,000 kilometers, the total construction investment will reach 21.4 trillion, corresponding to the market scale after operation and maintenance will reach 535 billion.In terms of urban rail: 2028 urban planning operations will exceed 1.50,000 kilometers, the total construction investment will reach 15 trillion, corresponding to the market scale after operation and maintenance will reach 375 billion.In terms of local freight railways: the operating mileage will reach 40,000 kilometers in 2028, and the total construction investment will reach 2.4 trillion, corresponding to the market scale after operation and maintenance will reach 60 billion.It is estimated that by 2028, the entire railway transportation and maintenance market size will be around 1 trillion yuan, and the company will fully benefit from the rapid development of the industry. Investment suggestion: The company is a leader in the long-term rail transportation operation and maintenance industry.We expect the company’s expected earnings in 2019/2020 to be 0.16/0.21 yuan, the current sustainable corresponding PE is 21 respectively.1/15.9 times, for the first time, the company was given a “cautious recommendation” rating. Risk reminders: Macroeconomic growth rate; Railway and city planning construction are less than expected; market competition is intensified; goodwill is high; accounts receivable is high;