China Baoan benefited from new energy vehicles net profit increased 4 times 858 million yuan invested in Beret to earn more than 27 billion yuan

Yangtze River Business Daily news ● Yangtze River Business Daily reporter Shen Yourong

China Baoan (000009. SZ) high-tech segment performance is eye-catching.

In the first half of the year, the revenue of China Baoan High-tech and Pharmaceutical Industry increased by 126.26% and 59.57% respectively, helping the company's overall revenue in the first half of the year to reach 8.048 billion yuan, doubling year-on-year.

Among them, the core subsidiaries of Beiterui and Ma Yinglong, which represent the two major sectors, have revenue of 4.207 billion yuan and 1.668 billion yuan, an increase of 168.83% and 70.07% year-on-year, contributing most of the revenue.

Profit growth is even more rapid, in the first half of the year, China Baoan net profit of 680 million yuan, an increase of 4 times year-on-year, only Beiterui net profit reached 730 million, deducting non-net profit to turn losses into profits, reaching 264 million yuan.

The Reporter of Changjiang Business Daily found that China Baoan started with real estate, and since 2014, it has focused on high-tech industries, and the company's net profit has come out of the perfect smile curve. In particular, beturi, the leader in investing in lithium-ion battery anode materials, has contributed most of its net profit in recent years. And China Baoan's investment of 858 million yuan insists on holding shares for nearly 20 years, and the current stock market value is about 28 billion yuan, earning more than 27 billion yuan and increasing by more than 31 times.

By the end of the first half of the year, there were 197 Holding Companies in China Baoan, and 38 associated enterprises in long-term equity investment, similar to shareholding platform groups, and with the withdrawal of the equity of these companies, China Baoan investment income or contribution is larger.

The proportion of high-tech industries has increased significantly by more than 60%.

This year is a bumper year for China's treasure safety noodles.

Among the three major sectors, the revenue of high-tech, pharmaceutical industry and real estate industry in the first half of the year was 4.896 billion yuan, 1.9 billion yuan and 1.051 billion yuan, an increase of 126.26%, 59.57% and 138.41% year-on-year.

The sharp growth of real estate projects is due to the concentration of settlement income, which is mainly the sales of tail plates or stock listings, and what is more eye-catching is that the increase in market demand in the new energy automobile industry has led to the rapid growth of high-tech industry revenue.

The performance of Bertry, an important enterprise in the high-tech industry, has soared. As a listed enterprise on the New Third Board and the global leader in anode materials for lithium-ion batteries, Beiterui has seized the opportunity of a substantial increase in the market demand for lithium-ion batteries for new energy vehicles.

In the first half of the year, Bertrui achieved operating income of 4.207 billion yuan, an increase of 168.83% year-on-year; achieved a net profit of 730 million yuan, an increase of 232.45% year-on-year.

In the first half of this year, Beiterui completed the transfer of Tianjin Nano and Jiangsu Nano (its lithium iron phosphate related assets and businesses) to Lopan Technology for 844 million yuan, and is expected to earn 138 million yuan, but even after deducting non-net profit, it still reaches 521 million yuan.

In addition, there are three subsidiaries of the new third board listed in the automotive industry in the high-tech sector, of which international precision, Youcheng Technology are mainly engaged in precision metal parts such as automotive hydraulics, automotive charging connector revenue of 426 million yuan and 161 million yuan, an increase of 41.74% and 92.73% year-on-year, and a net profit of 0.25 billion yuan and 0.17 billion yuan, an increase of 951.79% and 272.91% year-on-year. However, the production of motors, controllers and other products and continued to lose money, net profit -38.6752 million yuan, down 30.57%.

Overall, China Baoan's high-tech industry revenue accounted for 61.04%, gross profit accounted for 54.90%, and the total profit achieved was 959 million yuan, an increase of 270.33% year-on-year, accounting for 69.44%, accounting for a new high.

Judging from the above achievements, China Baoan high-tech industry is the leading business, and this business has become the core driving force of the company's performance.

In addition, in another large sector of the pharmaceutical industry, Ma Yinglong, a subsidiary of China Baoan, also performed well. In the first half of the year, the operating income was 1.668 billion yuan, an increase of 70.07% year-on-year, and the net profit was 255 million yuan, an increase of 8.30% year-on-year.

Under the simultaneous and substantial improvement of the three major sectors, the overall expense growth rate of China Baoan is far lower than that of revenue, although the company's gross profit margin in the first half of the year was 31.10%, which was still lower than last year, but the expense ratio during the period was 20.47%, the lowest in the past decade, and the net profit margin reached 13.79%, which was also the highest in the past five years.

Therefore, the profit growth rate in the first half of the year is much higher than the revenue. China Baoan achieved a total operating income of 8.048 billion yuan, an increase of 100.60% over the same period of the previous year, and a net profit attributable to the owners of the parent company of 680 million yuan, an increase of 402.95% over the same period of the previous year.

And in the previous two years, China Baoan deducted non-net profit losses, while in the first half of this year, China Baoan deducted non-net profit of 264 million yuan, compared with last year's loss of 0.95 billion yuan, a sharp turnaround.

China Baoan's share price has soared nearly twice in the past three months due to the increase in earnings expectations, and the current market value is about 74.8 billion yuan, an increase of nearly 49 billion yuan.

Invest in Beret to make a profit of more than 31 times

The sharp increase in the profitability of China Baoan this year is due to the improvement of the prosperity of the high-tech industry related to new energy vehicles on the one hand, and on the other hand, it is also related to the company's initiative to slim down and focus on the main business.

Founded in July 1983 and listed in 1991, China Baoan, which started with real estate, has gradually expanded through mergers and acquisitions, becoming a company dominated by high-tech and pharmaceutical industries today.

In recent years, China Baoan has successively sold part of the equity of Fangyuan Environmental Protection, 52% of the equity of Yongli Technology, 26.52 million yuan of registered capital of Chengdu Tiger, 45% of the equity of Wanxin Company, Gangbao Real Estate, Hubei Baoan, etc., and is committed to "building a high-tech industry group based on new materials".

Last year, China Baoan's asset-liability ratio was 58.42%, which fell below 60% for the first time, and fell to 57.13% again at the end of the first half of this year.

Through the sale of assets and other means, the investment income in 2019 and last year was 128 million yuan and 548 million yuan, which became a factor in the net profit reversal, and the investment income in the first half of this year was 605 million yuan, an increase of 174.53% year-on-year.

At present, China Baoan still owns A-share China Baoan, Ma Yinglong, H-share International Precision, New Third Board Beiterui, Dadihe, Youcheng Technology, Dafo Pharmaceutical, Green Gold High-tech and many other listed capital market companies, as well as more than 20 wholly-owned and holding enterprises.

Of all the investments, China Baoan's investment in Bertry is the most profitable.

According to the public transfer letter of Bertry, in 2000, Bertry was established, in 2002 China Baoan 6 million yuan into Bertrui held 40% of the shares, in 2004 4.37 million yuan to transfer 27.60% of the equity to achieve control, and in 2010 133 million yuan after the capital increase held 57.78% of the equity, in 2015 the company issued shares for 724 million yuan to acquire 32.1457% of the equity of Bertry, after the completion of china Baoan spent a total of 858 million yuan to hold 89.93% of the shares of Bertry.

At present, the stock price of Beiterui continues to hit new highs, with a market value of 41.1 billion yuan, in recent years, after the additional issuance and dilution of Beiterui, the company still holds 68.36% of the shares of Beiterui, with a stock market value of about 28 billion yuan, compared with the investment of 858 million yuan to earn more than 31 times.

At the same time, in recent years, the net profit of Beiterui has continued to grow, from 0.88 billion yuan in 2013 to 666 million yuan in 2019, and a slight decline last year still reached 495 million yuan. Higher this year hit a new high, contributing most of the company's profits.

In addition, China Baoan has 197 shareholding companies, 38 long-term equity investment in the associated enterprises, the amount of investment of 1.257 billion yuan, involving robots, hospitals, new materials, virtual reality, semiconductors and so on.

In the future equity withdrawal, China Baoan investment income may continue to contribute to greater profits.

Editor-in-charge: ZB

This article originated from the Yangtze River Business Daily