China Railway (601390): Rapid revenue growth Rail business gross profit margin drags down profit growth

China Railway (601390): Rapid revenue growth Rail business gross profit margin drags down profit growth

On August 31, 2019, the company released its 2019 interim report.

Total operating income was 3608.

2.1 billion, an increase of 14 over the same period last year.

73%; net profit attributable to shareholders of the listed company was 105.

1.4 billion, an increase of 10 over the same period last year.

06%; blacks earn 0.

399 yuan, an increase of 0 over the same period last year.

005 yuan / share.

Comment: Infrastructure construction, real estate average value achieved rapid growth, Q2 receivable growth acceleration report summary, the company’s infrastructure business continued to grow, achieving operating income of 3134.

98 ppm, an increase of 17 in ten years.

05%, accounting for 86% of total revenue.

63%; survey and design and consulting business realized operating income of 77.

54 ppm, a ten-year increase4.

82%; engineering equipment and parts manufacturing business realized operating income of 80.

17 ppm, an increase of 9 in ten years.

69%; real estate business realized operating income of 137.

38 ppm, an increase of 12 in ten years.

56%;

By quarter, the company’s Q2 revenue increased by 19%.

61%, compared with 7 ahead of Q1.

.

97%, Q2 growth rate increased significantly.

The comprehensive gross profit margin decreased in the first half of the year.

05%, 0 per year.

33 units.

The gross profit margin of the infrastructure is 7.

49%, a decrease of 0 every year.

For 15 samples, the gross profit margin of survey, design and consultation was 27.

27%, an increase of 0 every year.

01 single, engineering equipment and parts manufacturing gross margin 24.

53%, up by 1 each year.

16 levels, the gross profit margin of real estate development is 31.

96%, an annual increase of 4.

13 units.

The decrease in comprehensive gross profit margin was mainly due to the significant decrease in the gross profit margin of the railway business in the infrastructure business; the period expense ratio remained stable, management expenses, financial expense ratio decreased slightly, and the company’s period expense ratio was 5.

55% (-0.

08pct), which remained stable, with a sales expense ratio of 0.

51%, up 0.
03 units; management expense ratio 4.
32%, a decrease of 0.

1 unit, financial expense ratio is 0.

72%, a decrease of 0.

01 averages.

The increase in sales expenses was initially based on regional operations, three-dimensional management, and continued efforts to increase marketing and promotion; second, increased sales of real estate projects and industrial products; infrastructure contracts pushed new breakthrough units to continue to grow in the first half of the year.
400 million, an increase of 10 in ten years.

5%.

Among them, the infrastructure business developed steadily, with newly-signed contracts worth 597.9 billion yuan, an increase of 13 years.

5%; the value of newly signed contracts for survey, design and consulting service business was US $ 12.1 billion, a year-on-year decrease of 7.

6%; the new contract value of engineering equipment and parts manufacturing is 160.

800 million, down 4 every year.

6%.

The new contract value of real estate development business was 244.

8 ppm, an increase of ten years.

9%; the international and domestic markets go hand in hand. In the first half of the year, the company’s international and domestic markets go hand in hand. Overseas priority development and high-quality development strategies are solidly advanced.

The railway 武汉夜生活网 project of the Syrian Republic has won the bid, and the key projects of interconnection between neighboring countries such as China-Laos Railway, Indonesia-Yavana High Speed Rail, etc. have been steadily advanced.

The earliest adoption of the second session of the “Belt and Road” International Cooperation Summit Forum, the Malaysian Malaysia City Project resumed operation under the witness of the Prime Minister of China and Malaysia.

Maintain “Buy” rating. We estimate that the company’s operating income for 2019-2021 will be 8306 trillion, 9084 trillion, and 979.6 billion US dollars, respectively, an increase of 12%.

2%, 9.

4%, 7.

5%; net profit attributable to mothers is 190.

500 million, 209.

700 million, 226.

100 million, an increase of 10 each year.

8%, 10.

1%, 7.

8%.

It is expected that the EPS 杭州夜网论坛 for 2019-2021 will be 0.

83 yuan / share, 0.

92 yuan / share and 0.

99 yuan / share, corresponding PE is 7/7 / 6x. Railway investment has recovered significantly since this year. The company is also very competitive in the municipal field, benefiting from shortcomings in infrastructure and maintaining a “buy” rating.

Risk Alert Macroeconomic Risk; Production Safety Risk; Cash Flow Risk; Raw Material Price Risk