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    Analysis of Yatai Convertible Bond Purchase Value: The decoration engineering company focusing on high-end hotels

    2019-04-15 07:59:50

    Yue Reading Bond City Zhou Yue

    Basic conclusion

    event:On the evening of April 14th, ShenzhenYatai InternationalConstruction Co., Ltd. announced that it will issue 480 million convertible bonds on April 17, 2019. We briefly analyze this and the conclusions are as follows:

    The debt floor was 77.63 yuan and the YTM was 2.86%.Yatai Convertible Bonds has a maturity of 6 years, debt rating is AA-, par value is 100 yuan, coupon rate is 0.5% in the first year, 0.8% in the second year, 1.2% in the third year, 1.5% in the fourth year, and fifth. 2.0% in the year and 3.0% in the sixth year. The redemption price at maturity is 112% of the face value (including the last annual interest), and the discount rate is estimated according to the 6-year AA-enterprise bond yield to maturity (2019/4/12) 7.40%. The value is 77.63 yuan, and the YTM corresponding to pure debt is 2.86%. The debt protection is weak.

    The parity is 98.68 yuan, and the revised clause is easier to trigger.The conversion period is from the first trading day after the expiration of 6 months from the date of issuance to the maturity date of the convertible bonds. The initial conversion price is 17.49 yuan/share, Yatai International (002811.SZ) on April 12 The closing price is 17.26 yuan, corresponding to the convertible bond parity of 98.68 yuan. The revised terms of Yatai Convertible Bonds are: 15/30, 90%, conditional redemption terms are: 15/30, 130%, conditional resale terms are: 30, 70%, and the revised clause is easier to trigger.

    It is estimated that the price of Yatai Convertible Bonds will be between 106 and 108 yuan on the first day of listing.As of April 12, the parity of Yatai Convertible Bonds was 98.68 yuan. The comparable price can be referred to as the Xiaokang Convertible Bonds. The parity is 98.90 yuan, and the current conversion premium rate is 10.22%. The scale that can be referenced is the Anjing Convertible Bonds. The current conversion premium rate is 4.14%. Considering that Yatai Convertible Bonds' positive stocks perform well, it is expected that the first-day IPO premium will be between 7% and 9%, and the corresponding listing price will be in the range of 106-108 yuan.

    The ratio of placement is expected to be around 30%.Shenzhen Yatai Yizhao Investment Co., Ltd. directly holds 47.24% of the shares of Yatai International, which is the controlling shareholder of the issuer. Zheng Zhong and Qiu Ai directly and indirectly hold a total of 65.22% of the shares of Yatai International, which is the actual controller of the company. As of now, no shareholders have promised to participate in the priority placement. We expect the ratio of placement to be around 30%, so the size of the subscription to the market is about 336 million yuan.

    The winning rate is expected to be between 0.05% and 0.07%.The total purchase amount of Yatai Convertible Bonds is 480 million yuan. Assuming the ratio of placing is 30%, the amount available for investors to purchase is 336 million yuan. If the number of online purchases is 50-700,000, the average single purchase amount is capped. Playing new, the winning rate is expected to be between 0.05% and 0.07%.

    Yatai's debt-to-debt debt is weakly protected, but the current parity level is close to the face value, the important terms are quite satisfactory, and the positive stocks perform well. It is recommended that investors participate in the purchase.

    risk warning:Stock market volatility brings risks, and underlying stocks perform less than expected.

    I. Analysis of the basic elements of Yatai Convertible Bonds

    On the evening of April 14, Shenzhen Yatai International Construction Co., Ltd. (hereinafter referred to as “Yatai International”) announced that it will issue 480 million convertible bonds on April 17, 2019. The proceeds will be used for the proceeds. Renovation of Foshan Nanhai Hehua Doubletree Hotel, Xi'an Intercontinental Hotel Project Decoration Project and Sheraton Zunyi Hotel Decoration Project. Below we briefly analyze the purchase value of Yatai Convertible Bonds for investors' reference.

    The debt floor was 77.63 yuan and the YTM was 2.86%.Yatai Convertible Bonds has a maturity of 6 years, debt rating is AA-, par value is 100 yuan, coupon rate is 0.5% in the first year, 0.8% in the second year, 1.2% in the third year, 1.5% in the fourth year, and fifth. 2.0% in the year and 3.0% in the sixth year. The redemption price at maturity is 112% of the face value (including the last annual interest), and the discount rate is estimated according to the 6-year AA-enterprise bond yield to maturity (2019/4/12) 7.40%. The value is 77.63 yuan, and the YTM corresponding to pure debt is 2.86%. The debt protection is weak.

    The parity is 98.68 yuan, and the revised clause is easier to trigger.The conversion period is from the first trading day after the expiration of 6 months from the date of issuance to the maturity date of the convertible bonds. The initial conversion price is 17.49 yuan/share, Yatai International (002811.SZ) on April 12 The closing price is 17.26 yuan, corresponding to the convertible bond parity of 98.68 yuan. The revised terms of Yatai Convertible Bonds are: 15/30, 90%, conditional redemption terms are: 15/30, 130%, conditional resale terms are: 30, 70%, and the revised clause is easier to trigger.

     The decoration engineering company focusing on high-end hotels - Analysis of the purchase value of Yatai Convertible Bonds

    The total share dilution ratio is 15.25%.If the initial conversion price of Yatai International (002811.SZ) is 17.49 yuan/share, the dilution of the convertible bond issuance to the total share capital and the dilution of the circulation are 15.25% and 60.99%, respectively. Diluted pressure.

     The decoration engineering company focusing on high-end hotels - Analysis of the purchase value of Yatai Convertible Bonds

    Second, investment subscription advice

    It is estimated that the price of Yatai Convertible Bonds will be between 106 and 108 yuan on the first day of listing.As of April 12, the parity of Yatai Convertible Bonds was 98.68 yuan. The comparable price can be referred to as the Xiaokang Convertible Bonds. The parity is 98.90 yuan, and the current conversion premium rate is 10.22%. The scale that can be referenced is the Anjing Convertible Bonds. The current conversion premium rate is 4.14%. Considering that Yatai Convertible Bonds' positive stocks perform well, it is expected that the first-day IPO premium will be between 7% and 9%, and the corresponding listing price will be in the range of 106-108 yuan.

    The ratio of placement is expected to be around 30%.Shenzhen Yatai Yizhao Investment Co., Ltd. directly holds 47.24% of the shares of Yatai International, which is the controlling shareholder of the issuer. Zheng Zhong and Qiu Ai directly and indirectly hold a total of 65.22% of the shares of Yatai International, which is the actual controller of the company. As of now, no shareholders have promised to participate in the priority placement. We expect the ratio of placement to be around 30%, so the size of the subscription to the market is about 336 million yuan.

    The winning rate is expected to be between 0.05% and 0.07%.The total purchase amount of Yatai Convertible Bonds is 480 million yuan. Assuming the ratio of placing is 30%, the amount available for investors to purchase is 336 million yuan. If the number of online purchases is 50-700,000, the average single purchase amount is capped. Playing new, the winning rate is expected to be between 0.05% and 0.07%.

    Yatai's debt-to-debt debt is weakly protected, but the current parity level is close to the face value, the important terms are quite satisfactory, and the positive stocks perform well. It is recommended that investors participate in the purchase.

    Third, the fundamental analysis of the stock

    Yatai International is mainly engaged in the decoration design and engineering construction of high-end star-rated hotels. It has outstanding competitive advantages in this field and gradually enters the high-end residential, high-end office buildings, luxury clubs, commercial complexes and other high-end public building decoration fields. At present, the company's marketing network layout has expanded to include key regions and cities in Beijing, Shanghai, Chengdu, and Guangzhou. The company has also undertaken design business in India, Sri Lanka, and the Philippines.

    At present, the company's hotel design comprehensive strength has been among the world's top level. At the same time, in order to comply with the mainstream of international engineering contracting, the company has positioned the EPC model as the main mode of enterprise business, and continuously promoted the EPC turnkey project, and gradually established obvious advantages. EPC (Engineering-Procurement-Construction), Chinese is often referred to as the "design procurement and construction" mode, also known as the "turnkey project" mode. The company has achieved a seamless connection between design and construction. In addition to designing the brand CCD, Yatai International also has an industry-renowned engineering brand, ATG. The two brands can be described as “blood source”, which can be separated and cooperated. . The company's EPC turnkey projects such as Sofitel Foshan Louvre, Intercontinental Hotel Beijing Sanlitun Tongying Center, and Hangzhou Panhai Diaoyutai Hotel have won many international awards.

    As of 2018H1, the company's main controlling shareholding subsidiaries include Shenzhen Yatai International Property Services Co., Ltd., Zhengzhong Interior Design (Shenzhen) Co., Ltd., and Hong Kong New International Design Consultant (Shenzhen) Co., Ltd., except Shenzhen Yatai International Property Co., Ltd. Outside of the service company, the principal businesses of other subsidiaries are design or engineering construction, while Shenzhen Yatai International Property Services Co., Ltd. is principally engaged in property services. Through horizontal integration, the company has steadily expanded its traditional business and actively carried out other types of business.

     The decoration engineering company focusing on high-end hotels - Analysis of the purchase value of Yatai Convertible Bonds

    As of 2018H1, the construction project construction income was 862 million yuan, accounting for 81.71% of operating income, up 27.11% year-on-year; decorative engineering design revenue was 193 million yuan, accounting for 18.29%, up 30.37% year-on-year.The company's revenue is mainly contributed by the decoration engineering construction business.

    The increase in qualifications laid the foundation for the company's business expansion.The company has the qualification of “Special Grade A for Architectural Decoration Engineering Design” and “Professional Contracting Grade for Architectural Decoration Engineering”, and the qualification level has reached the highest level of architectural decoration enterprises. As of 2018H1, the company has added 4 qualifications, namely, the second-level contracting of electronic and intelligent engineering, the third-level contracting of electrical and mechanical installation engineering, the second-level contracting of waterproof and anti-corrosion thermal insulation engineering, and the third-level contracting of ancient construction engineering. The qualifications are constantly increasing, which is good for the expansion of the company's new business.

     The decoration engineering company focusing on high-end hotels - Analysis of the purchase value of Yatai Convertible Bonds

    The company's operating performance is good.The operating income of the company in 2016, 2017 and 2018Q3 was 16.64, 18.25 and 1.563 billion yuan respectively, an increase of -7.85%, 9.69% and 17.86% year-on-year. The revenue growth rate showed an upward trend. The net profit of the company in 2016, 2017 and 2018Q3 was 0.81, 1.08 and 0.79 billion respectively, representing an increase of -26.15%, 33.13% and 30.28%, and the net profit maintained growth.

    In terms of profitability, as of 2018Q3, the company's gross profit margin was 17.95%, which was 1.67 percentage points lower than that of its peers; the company's net profit margin was 5.04%, 0.85 percentage points higher than its peers.

     The decoration engineering company focusing on high-end hotels - Analysis of the purchase value of Yatai Convertible Bonds

    Operating capacity has declined.The turnover ratios of accounts receivable of the company in 2016, 2017 and 2018Q3 were 1.33, 1.23 and 1.02, respectively, showing a downward trend year by year. The recovery rate of accounts receivable was slowed down, and the efficiency of capital utilization gradually decreased. The inventory turnover ratios of the company in 2016, 2017 and 2018Q3 were 40.90, 41.08 and 25.17, respectively, and the inventory liquidity was weakened. As of 2018Q3, the company's inventories increased by 36.40% compared with the beginning of the year, mainly due to the increase in materials for construction projects.

     The decoration engineering company focusing on high-end hotels - Analysis of the purchase value of Yatai Convertible Bonds

    Sales and management expenses have increased significantly.The sales expense ratio, management expense ratio and financial expense ratio of the company 2018Q3 were 1.25%, 4.72% and 1.18%, respectively. Among them, the sales expenses were RMB 19,252,500, an increase of 58.39% over the same period of last year, mainly due to the increase in marketing network construction and sales personnel; the administrative expenses were RMB 68,399,400, an increase of 63.00% over the same period of last year, mainly due to the increase in rents of management personnel and office space; The financial expenses were RMB 18,436,700, a year-on-year decrease of 13.16%, mainly due to the reduction in the purchase of bank wealth management products.

    The company's 2018Q3 current ratio and quick ratio are 1.76 and 1.71, respectively, and the solvency is average.

     The decoration engineering company focusing on high-end hotels - Analysis of the purchase value of Yatai Convertible Bonds

    Fourth, risk tips

    Stock market volatility brings risks, and underlying stocks perform less than expected.

    Hot searchAnalysis of Yatai Convertible Bond Purchase Value

    Editor in charge: Robot RF13015

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