Shenzhen Expressway (600548) Quarterly Comment: 3Q Performance Exceeds Expectation, Toll Growth Rebounds

Shenzhen Expressway (600548) Quarterly Comment: 3Q Performance Exceeds Expectation, Toll Growth Rebounds

May 13, 2020 夜生活 by admin

Shenzhen Expressway (600548) Quarterly Comment: 3Q Performance Exceeds Expectation, Toll Growth Rebounds

In the third quarter of 19, revenue exceeded +1.

61%, net profit attributable to mother +10 for ten years.

00%, performance is higher than expected on October 30, the company released the 2019 third quarter report: 1) July to September, revenue increased by 1 year-on-year.

61% to 14.

8.6 billion, net profit attributable to mothers increased by 4.

00% to 5.

7.4 billion; 2) Performance exceeded expectations.


The 3Q performance base is relatively high. The company has confirmed in 3Q18 that: 1) the investment income of 71.88 million yuan from the transfer of Yuelong Company;

After the impact of non-recurring items is expected, the performance in the third quarter of 19 will increase 19.


We believe that the increase in non-profit is mainly due to the steady development of the highway main business and the increase in real estate delivery in Guilong.

We adjusted the company EPS to 1 for 2019/20/21.



23 yuan, raise the target price to 12.


90 yuan, maintain “Buy” rating.

Although ETC discounts dragged down the fee rate, the growth rate of deducting tolls still picked up significantly.
From July 武汉夜网论坛 to September, after citing the impact of the three project repurchase, the company’s toll revenue increased and increased by about 7.

9%, an increase of about 3 per year compared with the first half of the year.


Among them, the 3Q19 toll increase of the main sections of Jihedong, Jihexi, along the river, Qinglian, Shuiguan and Wuhuang Expressway increased by +1.

6%, + 2

2%, +10.

1%, +18.

4%, +5.

3%, +11.

7% (1H19 growth rate is +1.

1%, +1.

8%, +17.

0%, +9.

0%, -0.

8%, +5


Starting from July, the 5% discount on ETC tolls will be promoted nationwide, and the ETC discount in Guangdong will be adjusted from 98% to 5%.

We expect the multi-year impact of ETC discount changes on Guangdong’s rate to be -2.

5% (2H19), -3.

4% (1H20), -0.8% (2H20).

In this context, the traffic growth rate in 3Q19 was higher than the revenue growth rate, reflecting strong demand for road usage.

As the size of borrowings decreased and interest rates fell, the company’s financial expenses fell sharply in the third quarter of 19, and the company’s financial expenses decreased by one.

At 23 trillion, after adding back the gains on derivative instruments due to foreign exchange lock-up, the comprehensive financial expenses decreased by 83.09 million yuan, mainly because the repurchase of three projects reduced the size of borrowings and the average interest rate fell.

In order to improve the financial status of Yanjiang Company, Shenzhen Expressway Group injected US $ 4.1 billion in Yanjiang Company in the second quarter and transferred the syndicated loan of Yanjiang Company to the group.

According to the Interim Report, due to the higher credit rating of the group, the interest rate will be reduced by 10% after the loan is transferred to the group, reducing interest expenses.

In the fourth quarter of 19, Meilinguan real estate was delivered in a concentrated manner. The upgrade of ETC equipment affected the controllable and diversified business to advance in 4Q19.

We expect the Meilinguan project to be delivered by the end of the year, assuming a 95% carry-over of the first phase of the house and the project contributes a net profit of approximately 3.

9.9 billion.

Affected by the cancellation of the provincial border toll station policy, according to the interim report, the company will complete the ETC equipment renovation in 2H19, with a total capital expenditure expected to be 4.

3.8 billion, with an average depreciation of about 8 years.

In the short term, investment cash expenditures increase, but in the long term, charging efficiency improves and labor costs (1H19 is 1).

4.1 billion) is expected to decline.

The Outer Ring Expressway is expected to open to traffic in 2020, and the redundant staff will be diverted to the new road. It is expected that the labor cost per kilometer will be reduced at a faster pace.

The improvement of traffic efficiency is also expected to boost traffic flow, especially that part of the company’s roads are congested sections in the city.

Raise target price to 12.


90 yuan, maintain the “Buy” rating. Toll income increased faster than expected, we adjusted the net profit return to mother in 2019/20/21 forecast to 28.



8.1 billion (previously 27.



1.2 billion).

We raise our target price to 12 based on the segment valuation method.


90 yuan (12 the previous time.


High dividends are attractive.

Assuming a dividend rate of 45%, we expect the company to replace 5 in 2019/20/21 dividends.

49% / 4.

44% / 5.

19% (closing price 20191030).

Maintain BUY rating.

Risk reminder: The traffic flow is growing faster than expected, and environmental protection projects and Meilinguan projects are not progressing as expected.