Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

Binjiang Service Group / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/binjiang-service-group-co-ltd" target="_blank" data-smartkarma-citation="entities:28940:1" rel="noopener">Binjiang Service Group (3316 HK)</a> reported a solid earnings growth of 28% YoY, with revenue up 41%. Binjiang has outperformed its peers in the PMC space by a long way.</li>
<li>Net cash on the balance sheet increased to 37% of the current market capitalization, led by the growth of operating profits and payables.</li>
<li>The PE FY23e/24e now is a modest 11.2x FY23e/9.2x FY24e with dividend yield of 5.4%/6.5% FY23e/24e (assuming a 60% payout ratio).</li>
</ul>



Binjiang Service Group (3316 HK) reported a solid earnings growth of 28% YoY, with revenue up 41%. Binjiang has outperformed its peers in the PMC space by a long way.
Net cash on the balance sheet increased to 37% of the current market capitalization, led by the growth of operating profits and payables.
The PE FY23e/24e now is a modest 11.2x FY23e/9.2x FY24e with dividend yield of 5.4%/6.5% FY23e/24e (assuming a 60% payout ratio).


Binjiang 3316 HK: >30% Profit Growth, Dividend Yield~6.5%, Cash Now 37% of Market Cap

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

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<li>
<a href="https://www.smartkarma.com/entities/jinke-smart-services-group-co" target="_blank" data-smartkarma-citation="entities:29214:1" rel="noopener">Jinke Smart Services (9666 HK)</a> is in a trading halt “<em>pending the release of an announcement pursuant to the Hong Kong Code on Takeovers and Mergers which constitutes inside information</em>.”</li>
<li>It is likely that Boyu, the largest shareholder, is seeking to privatise Jinke. The privatisation of PRC-incorporated entities is usually done through a merger by absorption.</li>
<li>I use several methods to triangulate the likely offer price, which suggests a price range of HK$10.00-16.86, with an average of HK$12.47, a 45% premium to the last close.</li>
</ul>



Jinke Smart Services (9666 HK) is in a trading halt “pending the release of an announcement pursuant to the Hong Kong Code on Takeovers and Mergers which constitutes inside information.”
It is likely that Boyu, the largest shareholder, is seeking to privatise Jinke. The privatisation of PRC-incorporated entities is usually done through a merger by absorption.
I use several methods to triangulate the likely offer price, which suggests a price range of HK$10.00-16.86, with an average of HK$12.47, a 45% premium to the last close.


Jinke Smart Services (9666 HK): Boyu to Launch a Privatisation Offer?

<ul>
<li>
<a href="https://www.smartkarma.com/entities/times-neighborhood-holdings" target="_blank" data-smartkarma-citation="entities:28666:1" rel="noopener">Times Neighborhood (9928 HK)</a> has been a disastrous call since we first highlighted it. In this insight, we reflect upon the red flags we could have done well to spot. </li>
<li>We cover red flags ranging from the level of precise guidance, pivot in strategy, and the parent's poor financial health, to the effect on receivables sucking cash from the company. </li>
<li>Everyone makes mistakes (we are human, after all). We would like to share our experience to educate readers to become better investors and sidestep investments in such names.  </li>
</ul>



Times Neighborhood (9928 HK) has been a disastrous call since we first highlighted it. In this insight, we reflect upon the red flags we could have done well to spot. 
We cover red flags ranging from the level of precise guidance, pivot in strategy, and the parent's poor financial health, to the effect on receivables sucking cash from the company. 
Everyone makes mistakes (we are human, after all). We would like to share our experience to educate readers to become better investors and sidestep investments in such names.  


Takeaways from the Times Neighborhood Investment Debacle

<ul>
<li>
<a href="https://www.smartkarma.com/entities/binjiang-service-group-co-ltd" target="_blank" data-smartkarma-citation="entities:28940:1" rel="noopener">Binjiang Service Group (3316 HK) </a>posted a 42% YoY increase in revenue and 19% YoY in profits for FY23, aided by 170% revenue growth in VAS services (24% of revenues).</li>
<li>Margin decline remains a concern, with a GPM(%) decline of 510 bps to 24.8%, with declines across all business segments. </li>
<li>Net cash increased to 74% of market capitalization, with the company declaring a dividend of 1.37 HKD/share ( implying an 8% trailing yield). </li>
</ul>



Binjiang Service Group (3316 HK) posted a 42% YoY increase in revenue and 19% YoY in profits for FY23, aided by 170% revenue growth in VAS services (24% of revenues).
Margin decline remains a concern, with a GPM(%) decline of 510 bps to 24.8%, with declines across all business segments. 
Net cash increased to 74% of market capitalization, with the company declaring a dividend of 1.37 HKD/share ( implying an 8% trailing yield). 


Binjiang (3316 HK) FY23 Results: 74% of the Market Cap in Cash, 8% Dividend Yield

<ul>
<li>A recent rally in property management companies due to measures taken by the government has set <a href="https://www.smartkarma.com/entities/binjiang-service-group-co-ltd" target="_blank" data-smartkarma-citation="entities:28940:1" rel="noopener">Binjiang Service Group (3316 HK)</a> for a big move upwards.</li>
<li>The stock is cheap and trades at 10.5x/8.1x FY22/23e PE with 37% of the market cap in cash and a 5.8%/7.4% FY22e/23e dividend yield.</li>
<li>Catalysts for the company are further loosening on the property by the government and a profit alert of 38-40% earnings growth for FY22.</li>
</ul>


A recent rally in property management companies due to measures taken by the government has set Binjiang Service Group (3316 HK) for a big move upwards.
The stock is cheap and trades at 10.5x/8.1x FY22/23e PE with 37% of the market cap in cash and a 5.8%/7.4% FY22e/23e dividend yield.
Catalysts for the company are further loosening on the property by the government and a profit alert of 38-40% earnings growth for FY22.


Binjiang: Set up for a Good Move From Here

China

Binjiang Service Group Co. Ltd. operates as a reputable property management service provider. The Company offers property management services including security, cleaning, gardening, repair, maintenance, and ancillary services to at residential and non-residential properties. Binjiang Service Group serves customers in China.

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Binjiang Service Group (3316 HK)

Binjiang 3316 HK: >30% Profit Growth, Dividend Yield~6.5%, Cash Now 37% of Market Cap

Binjiang's PE FY23e/24e now is a modest 11.2x FY23e/9.2x FY24e with dividend yield of 5.4%/6.5% FY23e/24e (assuming a 60% payout ratio). The...

Sameer Taneja

Jinke Smart Services (9666 HK): Boyu to Launch a Privatisation Offer?

I use several methods to triangulate the likely offer price, which suggests a price range of HK$10.00-16.86, with an average of HK$12.47, a 45%...

Arun George

Takeaways from the Times Neighborhood Investment Debacle

We summarise our learnings /mistakes from the Times Neighborhood investment debacle. This piece covers aspects of financial analysis critical to...

Sameer Taneja

Binjiang (3316 HK) FY23 Results: 74% of the Market Cap in Cash, 8% Dividend Yield

We summarize the results for FY23 for Binjiang Svc Co ( 3316 HK), a PMC in China. Trading at 6.9x FY24 PE with a >8% dividend yield and 74% of the...

Sameer Taneja

Binjiang: Set up for a Good Move From Here

Binjiang trades at 10.5x/8.1x FY22/23 PE with a dividend yield of 5.7/7.4% based on a 60% payout ratio. It is the best way to play the PMC bounce...

Sameer Taneja

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