Hisense Home Appliances (000921): Revaluation of Central Air Conditioning: A Shares Progressively Reasonable

Hisense Home Appliances (000921): Revaluation of Central Air Conditioning: A Shares Progressively Reasonable

Event description: Hisense Hitachi, the purest central air-conditioning target, is proposed.

The company recently announced that it intends to transfer Hisense Hitachi 0 held by United Trade for 25 million yuan.

2% equity, the company held a total of 49 shares after the completion of the transfer.

2%, which translates into the scope of Hisense Hitachi’s consolidated consolidated statement; 北京夜网 the number of directors appointed by Hisense Home Appliances can also be reset to 3 (total of Hisense Hitachi’s board of directors from 7 to 9).

Democracy, Hisense Hitachi’s performance is reflected in the company’s statements in the form of investment income; after the consolidation, it is expected that the central air-conditioning business will account for more than 20% of the company’s total revenue, and profit will account for more than 60%. Hisense appliances are A / H sharesThe purest central air conditioner.
Compared with the original investment income, the consolidated Hisense Hitachi can also be revalued.

Household central air-conditioning industry: In 2019, it may benefit from the improvement of real estate completion.

It is said that in HVAC homes, the central air-conditioning market capacity YoY + 10 in 16-18.

6% / + 17.

2% / + 4.

9%, the overall decline of the industry in 2018 is highly related to the pressure on the real estate boom.

With reference to the leading trend of newly started housing area relative to completed area, it is expected that the growth rate of real estate completion in second-, third-, and fourth-tier cities will significantly improve in 2019, driving the prosperity of the downstream real estate industry.

The current penetration rate of home central air-conditioning is still low (less than 2%). Under the trend of consumption upgrade and hardcover delivery of new houses, the home central air-conditioning industry is expected to benefit significantly.

Hisense Hitachi central air-conditioning: The company’s domestic multi-connected market share (15% +) is second only to Daikin, and it is one of the leading domestic central air-conditioning companies.

The company is leading the technology in the field of multi-connected air-conditioning and is at the forefront of the industry in terms of after-sales service. It has gradually expanded its channels and achieved significant results.

14-17 Hisense Hitachi revenue CAGR + 31.

6% net profit CAGR + 30.

2%; and in the context of the industry’s growth rate of central air conditioning fell to a number, 18H1 revenue increased 23% year-on-year, showing the leading strength.

Hitachi Central Air Conditioning’s profitability was significantly incorporated into the company’s original main business, with a net profit of 18A / 17A / 18H1.

8% / 16.

7% / 14.

7% (18-year York amortization drives down net margin).

It is estimated that Hisense Hitachi will contribute 800 million + / 1 billion + for listed companies in 18/19.

The segment evaluates “Central Air Conditioning and Former Main Business”, 0921.

HK is significantly undervalued.

After the consolidation of central air-conditioning business, comparable company Japan Daikin PE-2019e 19x; Considering different market environments and industry segments, adjusted by 15xPE, Hisense’s central air-conditioning business has a target market value of 150 billion + in 2019; the original main reference revenue bodyFor the benchmark A shares, Changhong Meiling has a market value of about 50 billion; therefore, the company’s reasonable market value is about 20 billion +.

Both A and H shares are currently undervalued (to 13.

The value of the A / H stock market calculated by 600 million shares is 17.6 billion / 12.9 billion respectively, of which Hisense Appliance 0921.

The undervalued value of HK is more significant, and the margin of safety is higher.

Risk warning: The original main business fluctuated more than expected, and the growth of central air conditioning exceeded expectations.