Zhongnan Construction (000961): The performance of the stock incentive plan can be expected to increase

Zhongnan Construction (000961): The performance of the stock incentive plan can be expected to increase

The event company announced the budget of the 2019 equity incentive plan on the evening of May 30, and proposed to grant 134.37 million stocks, accounting for 3 of the total shares.

73%; 112.09 million 486 incentive objects were awarded for the first time at an exercise price of 8.

49 yuan.

Comment on the landing of equity incentives, demonstrating growth confidence.

The company intends to award incentives to 137.37 million shares, accounting for the company’s total shares (37.

100 million shares) 3.

73%, of which 11.209 million shares were awarded for the first time, accounting for 3.

02%, the corresponding exercise price is 8.

49 yuan.

The target of this incentive plan is the company’s real estate, construction business headquarters and regional relevant persons in charge and key personnel (excluding directors and senior executives). The number of first-time awards was 486.

The plan is exercised in three phases, and the evaluation standard is that the company’s net profit attributable to the parent in 2019/2020/2021 will not gradually decrease by 560% / 1060% / 1408% compared to 2017, corresponding to the net profit attributable to the parent of US $ 40/70 / 9.1 billion (annual(Average compound strength of 61%), and at the same time, the individual annual performance assessment has reached the standard.

The company implemented incentive plans for two consecutive years in 2018 and 2019, showing long-term growth confidence.

Land reserves are abundant, sales are high, and performance growth is highly certain.

From the beginning, the company has added 2.44 million square meters of land reserves. At the end of the first quarter, the stock of land reserves increased by 4% to 44.81 million square meters.

From January to April, the contract amount of the company increased by 29% annually to 463 trillion, which is at a relatively high level among the leading real estate enterprises.

We expect that the company will achieve at least 200 billion yuan (a 36% increase) sales target in 2019 with the support of over 3500 ppm saleable value, and the total of 2018 and 2019 will reach 346.6 billion yuan, which has basically locked the company in 2019-A total of 2 million yuan in performance commitments in 2021 (reassessed with 70% of sales equity and 8% of real estate business net profit margin).

Thoroughly recommend logic and raise target price by 13% to 11.

24 yuan.

High resale growth, strong performance growth certainty, estimated attractive recommendation logic.

The company is currently trading ahead of 7.


5x 2019 / 2020e P / E ratio. Considering that the implementation of the incentive plan enhances the certainty of performance growth, we raise the 2020 profit forecast by 7% to 1.

87 yuan, raise the target price by 13% to 11.

24 yuan, the new target price corresponds to 10.


0x 2019 / 2020e target price-earnings ratio and 33% upside.

Risks are mainly 杭州夜网论坛 laid out Tighter-than-expected city adjustment policies.