Sina tip: This is a column of individual stock comments. It is only the personal opinion and analysis of securities consultants on relevant individual stocks or sectors, not a formal news report. Sina does not guarantee its authenticity and objectivity. Investors will operate accordingly at their own risk. Please refer to the announcement of Shanghai and Shenzhen Stock Exchanges for all accurate information about the shares. Wu Jianxiong of Zhongyuan Securities
The company's main businesses include real estate business and metal products business. The metal products business is in a stable development stage, while the real estate development and sales business is still in a rapid growth stage.
The transformation of urban villages is a booster for the rapid growth of the company. The company is currently a leading real estate development enterprise in Wuhan. Its unique "urban village transformation mode" is an important booster for the company's growth in the past. The large-scale reconstruction of villages in cities in Wuhan has provided a broad space for the company to lock up a large-scale high-quality land reserve in the city center with less funds.
The company has sufficient land reserves from the reconstruction of villages in cities. The vast majority of the company's land reserves in Wuhan come from the reconstruction project of urban villages, with a total planned floor area of 6.42 million square meters. By the end of 2011, the scale of land reserves available for future settlement had reached 4.7 million square meters.
The sales volume and gross profit of metal products business are expected to stabilize. Metal products business is a traditional mature business of the company, which can bring stable cash flow and net profit. The company will maintain the stable development of metal products business. In the first half of the year, the production, sales and gross profit margin of the company's metal products improved compared with the same period last year.
Earnings forecast and company valuation: It is predicted that the company's earnings per share in 2012-2014 will be 0.89 yuan, 1.23 yuan and 1.37 yuan respectively, and the corresponding dynamic P/E ratios will be 10.23 times, 7.45 times and 6.68 times based on the closing price of 9.15 yuan on July 6; The RNAV valuation of the company is 12.89 yuan. The valuation of the company has advantages, and the investment rating of the company has been raised from "overweight" to "buy".
Risk tip: At present, housing prices in some cities are rising in both quantity and price, which may lead to another tightening of regulatory policies. On the one hand, the tightening of policies will increase the difficulty of the company's sales, on the other hand, it will cause a big negative impact on the company's estimates.
