分类： 其他平台
2014-10-16 11:29:00
Feb 17th, 2012 Company Report
ZhengTong Auto（1728.HK）
A Leading Luxury Auto Dealer
Investment Highlights：
BUY
Price Target：HK$ 11.1 Upside：+17%
ZhengTong Auto is a leading auto dealer in China. ZhengTong
Auto mainly sells premium cars such as Audi and Benz. After the acquisition of SCAS in Sep. 2011, ZhengTong ranks No.6 in terms
of revenue among all the Chinese auto dealers.
Key Data
Price (HK$)
Shares Outstanding (m) Market Cap. (HK$ m) Free float (%) 52 Week Range Controlling Shareholder
BVPS (RMB)
Asset-liability ratio (%)
9.5 2,208 20,976 72.70% 11.48 / 5.46
Joy Capital Holdings Limited
2.2
48%
? ZhengTong Auto focuses on luxury cars and it has obtained the
most luxury brands than any other auto dealers listed in Hong Kong. More than 80% of ZhengTong’s new car sales revenue is from luxury brands, and the share is expected to increase further. At the end of 2011, 3/4 of the company’s shops sell luxury car, and the company has obtained authorization for the distribution of 9 luxury brands, the most in Hong Kong listed auto dealers. Between 2005 and 2011, the sales of its top three brands grew at a CAGR of more than 45%. We estimate it has even more growth
potential down the road.
Price Performance Chart ? The company is vigorously developing its luxury car sales
network. ZhengTong Auto plans to open 20 4S luxury car shops in 2012-2013 and sell some new brands. Additionally, the company is building up its presence in the 2-3 tier cities and inland
cities to fulfill the growing demand for luxury cars there.
nd
rd
? Explosive growth expected and initiate Buy. We believe
Zhengtong Auto is riding the wave of China’s luxury cars, and the
company is expanding its luxury 4S car shops by 20 per year in 2012-2013, giving it more potential to benefit from the surge in luxury car sales in China. We initiate coverage of the company with a Buy rating and a TP of HK$11.1, which corresponds to 15x 2012PE.
Related Reports:
《Going from Strength to Strength in the No.1 Auto Market》
Jan. 26th, 2012 Feb. 8th, 2012
《Riding the Wave of Luxury Cars》
Turnover (RMB m) Turnover Growth (%) Net Profit (RMB m)
4,981 64% 146 331% 0.10 0.18 80.1 25.4
8,034 61% 276 89% 0.18 -0.08 43.2 2.9
14,707 83% 158% 0.32 0.06 24.2 2.5 0.02
32,228 119% 88% 0.61 0.12 12.9 2.1 0.06
44,983 40% 34% 0.81 0.20 9.6 1.8 0.08
Machinery & Transportation Equipment
712 1,338 1,795
Net Profit Growth (%) Analyst：John Luo
SFC CE No.: AVT518 EPS (RMB) 00852-2899 8300 CFO per share(RMB) john.lu@guosen.com.hkP/E (x)
P/B (x)
NA NA Dividend per share(RMB)
Source: Bloomberg, Guosen Securities (HK)
For ratings definitions and other important disclosure, refer to the Disclosure Section at the end of this report.
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