Anhui Water Conservancy (600502) 2019 Interim Report Review: Better-than-expected performance Real Estate and PPP business helped performance


Anhui Water Conservancy (600502) 2019 Interim Report Review: Better-than-expected performance Real Estate and PPP business helped performance

The performance exceeded expectations, benefiting from the acceleration of the real estate and PPP income transfer to the company in the first half of 2019 to achieve operating income of 190.

20,000 yuan, an increase of 16 in ten years.

50%; achieve net profit attributable to mother 3.

900,000 yuan, an increase of 34 in ten years.

82%; net profit deducted from non-attributed mothers3.

870,000 yuan, an increase of 40 in ten years.


The higher-than-expected performance was mainly due to the concentrated delivery of real estate projects and the increase in settlement income of PPP projects in the first half of the year.

Among them, the actual business in 2018 benefited from the high prosperity of the real estate market in hot third- and fourth-tier cities such as Bengbu and Fuyang, and achieved a contracted sales area of 159.

670,000 square meters, with a contracted sales amount of 93.

3.3 billion, an annual increase of 49.

10%, 60.


With the concentrated delivery of hot sales revenues such as Bengbu Qinyuanchun, we expect to continue high growth in the second half of the year.

After the PPP was standardized, the landing rate continued to rise. The company’s PPP orders in hand in 2018 were about 262.

66 ppm, 34% of total orders in hand.

83%. In the future, PPP projects in hand will accelerate and contribute more to the company’s construction revenue and profits.

  The growth of Q2 performance has accelerated significantly. In terms of quarters, the company completed revenue of 93 in Q3 2018, Q4, 19Q1 and Q2.

8.3 billion, 131.

35 billion, 71.

8.1 billion, 118.

2.1 billion, a ten-year growth of -7.

29%, 14.

78%, -2.

74%, 32.

42%; realized net profit1.

44 billion, 3.

6.7 billion, 1.

10 billion, 2.

8 billion, a growth of -0 in ten years.

46%, 4.

90%, 0.

51%, 55.


The company’s performance growth in the second quarter accelerated significantly.

  Debt-equity swaps have been steadily progressing. It is estimated that the net safety margin has been high. Since the debt-equity swap was first opened at the end of last year, the company re-introduced CCB Investment in July this year to increase the capital of its subsidiary Anhui Luqiao and implement market-oriented debt-equity swaps.

Through two debt-to-equity swaps, the company reduced its asset-to-debt ratio2.

45pct, if you consider the carry-over of real estate advances, the company’s asset-liability ratio will gradually reach below 80% this year.The company’s steady reduction in leverage is conducive to improving the capital structure and long-term sustainable development.

The company’s current PE (TTM) is 9.

12 times, at an absolute low in history; PB is 0.

82 times, which has continued to break in the past two months. The prospect of a high safety margin has ushered in an estimated repair.

  Investment suggestion: Anhui infrastructure leader that is undervalued. Maintain “Buy” rating. The company’s EPS in 19-21青岛夜网 is expected to be 0.



87 yuan, corresponding to 7 for PE.



9 times.

  Relative estimation method is used to give 9-10 times PE in 19 years, corresponding to reasonable estimation interval 5.


80 yuan, which is 23 relative to the current sustainable.

11% -36.

79% premium space, maintain “Buy” rating.

  Risks indicate bad debts of accounts receivable, total investment in fixed assets, etc.