Jiangsu Guoxin (002608): Steady growth of synergistic and complementary performance of the two main businesses
Event: The company disclosed its 2018 annual report and achieved total operating income of 221.
35 ppm, an increase of 9 in ten years.
56%; net profit attributable to shareholders of the parent company25.
56 ppm, an increase of 17 in ten years.
At the same time, the first quarter report of 2019 was disclosed, and the operating income was 45.
86 ppm, a decrease of 13 per year.
71%; net profit attributable to shareholders of the parent company11.
50,000 yuan, an increase of 148 in ten years.
Investment Highlights The company’s 2018 performance year +17.
3%, +22 in Q1 2019.
5% (excluding the impact of Li’an Life): 1) The company’s total operating income in 2018 +9.
6% to 221.
400 million, net profit attributable to mother +17.
3% to 25.
60,000 yuan, both of the two main industries are growing steadily.
The net profit of the trust / energy business is +14 per annum.
7% / + 20.
0% to 15.
40,000 yuan (among which the trust business contributes 54 to maximize consolidated profits.
2) In the first quarter of 2019, the growth of trust business realized that the fee and commission income increased by 30 each year.
5% to 2.
50,000 yuan, total investment income +344.
0% to 11.
80,000 yuan, which is recognized by the equity method of Li’an Life’s income (Jiangsu Trust became the largest shareholder of Li’an Life, adding 9. after the change in accounting standards.
Investment income of 190,000 yuan), the growth rate affects Jiangsu Guoxin’s net profit attributable to the parent in 2019Q1 is about 5.
60,000 yuan, excluding this effect, the company reported a profit of about 5 in the first quarter.
45 ppm, an increase of 22 in ten years.
Jiangsu Trust’s proactive management capabilities have been improved, and high-quality corporate equity investment is expected to contribute to profit increase: 1) Jiangsu Trust’s 2018 revenue increase +11.
5% to 11.
300 million, net profit attributable to mother +14.
7% to 15.
100 million yuan, contributing 59% of the group’s performance.
Complete capital increase and share expansion 49.
100 million US dollars, further strengthened capital strength to promote high performance.
2) The trust business structure was optimized, and the scale of active management trusts exceeded +25.
1% to 68.4 billion, the proportion rose to 16.
Since the second half of 2018, the regulatory margin has been loosened. The social financing data in 2019 exceeded expectations, and the size of newly issued collective trusts continued to increase (+9% / + 51% / + 11% in the same period of 1/2/3 March).
Optimistic about the market’s warming background, the company’s active transition and active management have brought about improvement in profitability.
3) Jiangsu Trust realized investment income growth of +28.
8% to 12.
80,000 yuan, is a broad-based equity investment business, has invested in Bank of Jiangsu (holdings).
04%), Lee On Life (holding 22 shares.
79%) and other high-quality enterprises, the investment benefits are significant, and it is expected to contribute to incremental profits in the future.
Energy + finance is driven by two wheels, and the combination of industry and finance plays a complementary role: 1) In terms of energy business, the growth of power generation has been gradually increased by +4 in 2018.
1% to 515.
0 billion kilowatt-hours, complete funding for every +24.
36% to 568.
0 nominal, maintaining a high growth rate.
2) New progress has been made in the 西安耍耍网 financial field. Jiangsu Trust has completed its capital increase and share expansion, increased its holding of the firm’s largest shareholder, and transferred Li’an Life to its largest shareholder. The financial layout was further comprehensive.
3) Energy + finance, as two core businesses, has a good structure of consolidated financial assets and a reasonable layout; it can replace energy business with stable operations, stable cash flow, and complement each other to realize the combination of production and finance and play a complementary effect.
Earnings forecast and investment rating: The active transformation of trust business management has been smooth, and the equity investment business has benefited significantly. With the recovery of the industry, profitability has improved, the energy business has continued 武汉夜生活网 to grow, and its operations have been stable.
In the future, the company will take advantage of the synergy of trust and energy as its dual main business. We expect the company’s net profit in 2019 and 2020 to be 33.
60 ppm, maintain “Buy” rating.
Risk warnings: 1) Trust recovery is worse than expected; 2) Trust and energy dual-main business integration is worse than expected.