Aijian Group (600643) Semi-annual Report Comment: Trust Leasing Driven Growth Performance Meets Expectations
Event: Recently, Aijian Group released its semi-annual report for 2019 and achieved a total operating income of 19%.
51 ppm, an increase of 58 in ten years.
02%; net profit attributable to mother 6.
30 ppm, an increase of 16 in ten years.
69%; basic profit return is 0.
Investment highlights: The trust business is improving and supporting performance is in line with expectations.
2019H1 Aijian Trust achieved total operating income10.
9.6 billion, an annual increase of 13.
64%; net profit attributable to mother 5.
$ 8.5 billion, an annual increase of 2.
1) Trust business is stable and litigation events have been a drag.
Taking into account the pressure on the industry’s asset end due to the macro downward pressure in the first half of the year, and the supervision policy represented by “Document 23” proposed to strictly control the real estate trust, the double-digit revenue growth of Aijian Trust was relatively considerable.
The company’s weak net profit performance was mainly due to Fangda Carbon’s complaint that Aijian Trust and other shareholders had insufficient capital contributions, resulting in non-operating expenses.
6.1 billion yuan, after excluding this factor, the net profit growth rate of Aijian Trust was 30.
90%, still maintained steady growth.
2) The trust return is expected to increase with the industry.
According to the data disclosed by the Trust Industry Association, the average annualized comprehensive trust return of the trust industry in the first quarter of 2019 was 0.
43%, a slight increase in one year, it is judged that the proactive management transformation led to the increase in premiums.
In the past two years, the company has followed up with the industry trend to actively manage the transformation. After the implementation of the new asset management regulations, it has vigorously cleaned up the channel and multi-layer stacking business. It is expected that the trust return will steadily increase.
3) Continuously promote business innovation.
In 2019H1, the company merged and advanced its supply chain finance-related businesses in an orderly manner, and completed the issuance of multiple projects; gradually continued to advance technical cooperation with large platform companies on the other side of consumer finance, and the business structure was continuously optimized.
The leasing business performed well and strengthened the public utility business.
2019H1 Aijian Leasing achieved total operating income2.
One million yuan, an annual increase of 45.
97%; realized net profit of 0.
杭州桑拿5 billion US dollars, an annual increase of 7.
30%; estimated interest-generating asset balance 51.
6.3 billion, an annual increase of 45.
In September 2018, after the company’s major shareholder Junyao Group acquired 100% equity of Huarui Leasing, it completed the leasing fields such as aviation and standby engines, and initially completed the integration of leasing resources with major shareholders, and its business structure became increasingly perfect.
2019H1 Huarui Leasing achieved a net profit of 0.
US $ 5.1 billion, with interest-generating assets exceeding US $ 5 billion, effectively increasing the contribution of the leasing business to the Group’s profit.
In addition, Aijian Leasing further strengthened its public utility business in the first half of the year, increased the business investment in the medical and education sectors, and actively explored innovative business models such as logistics, urban service upgrades, and energy and environmental protection.
Large shareholders continue to increase their holdings and deploy a comprehensive financial services system: In 2015-2018, when the new major shareholder Junyao Group took over, the company’s annual average compound growth rate of total operating income and net profit attributable to mothers was 24.
37% and 22.
61%, significantly higher than the previous growth rate. The private management mechanism and group business resources it brings to the company’s operations are evident.Yao Group also maintains a high degree of strategic focus on the company and continues to increase its holdings in the secondary market.
The latest announcement shows that Junyao Group’s shareholding in the company has changed from the initial 22.
08% increased to 28 at the end of August 2019.
84%, while consolidating the subsidiary’s subsidiary, it also shows confidence in the company’s long-term operation.
Making full use of the major shareholders’ industrial resources in the aviation, consumer, education and science and technology sectors, the company comprehensively promotes the development strategy of integration of production and integration, and uses Aijian Trust, Aijian Lease, Aijian Securities, Aijian Wealth, Aijian AssetsMulti-level financial functions of sustainable subsidiaries to develop an integrated financial service system.
Investment advice and profit forecast: Under the influence of multiple unfavorable factors such as pressure on the asset side, active transition pains, and strict supervision of real estate trust, the company’s core trust business continued to improve, showing long-term operating strength.
At the same time, the conventional diversified financial business represented by leasing proposed significant marginal improvement measures with the support of major shareholders.
Optimistic about the potential of the company’s transformation into an integrated financial services platform, it is expected that the operating efficiency and profitability will continue to improve.
We forecast the company’s net profit attributable to its parent to be 14 in 2019/2020/2021.
08 million yuan, an annual increase of 29.
35% / 8.
30% / 5.
27%, the current sustainable corresponding PB is 1.
02 times, still maintain the “overweight” rating.
Risk warning: the trend of stabilization of the macro economy has changed; the financial supervision has exceeded expectations; the growth rate of social financing and trust loans has fallen short of expectations; the progress of the company’s active management transformation has fallen short of expectations; and the quality of leased assets has been replaced.