Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

A buy-side analyst with over 15 years of experience investing in Asian markets and specializing in the mid-small cap space, emphasizing value investing in companies with good free cash flows/dividends and long-term holding horizons. 
Exempt Financial Adviser (EFA) under CrossASEAN Research Pte Ltd. 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 Analyst

Binjiang 3316 HK: Most Resilient Private PMC with Good Upside Potential

Binjiang: Set up for a Good Move From Here

China Property Management - Sector Deep Dive and Evaluation Framework

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

<p><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> announced a positive profit alert guiding profit growth of not less than 70% for FY20. On an adjusted profit base of 125 million RMB for FY19, we arrive at a net profit of at least 213 mn RMB for FY20.  We believe the company can grow its earnings by 35% CAGR for the next 2 years, implying a valuation of 10.3x PE FY22 (4.2x EV-EBITDA)  and a dividend yield of 6.0% based on a 60% dividend payout ratio. With more than 33% of the market capitalization in cash, we believe that the management could hike their payout if they do not find suitable acquisition targets.</p><h3>Key Upside Risks</h3><ul>
<li>Besides having a great valuation, we believe that upside risk could come from the sector's policy, which <a href="https://www.smartkarma.com/profiles/zhen-zhou-toh" target="_blank" data-smartkarma-citation="accounts:673" rel="noopener">Zhen Zhou, Toh</a> has elaborated on in his insight <a href="https://www.smartkarma.com/insights/china-property-management-services-green-light-to-grow" target="_blank" data-smartkarma-citation="insights:46805" rel="noopener">China Property Management Services - Green-Light to Grow</a>.</li>
<li>Shareholder-friendly actions like increasing the payout etc., in the final result. </li>
</ul><h3>Key Downside Risks </h3><ul><li>Incremental tightening on the China property sector could impact VAS income to non-property owners.</li></ul>

Binjiang Service Group (3316 HK) announced a positive profit alert guiding profit growth of not less than 70% for FY20. On an adjusted profit base of 125 million RMB for FY19, we arrive at a net profit of at least 213 mn RMB for FY20.  We believe the company can grow its earnings by 35% CAGR for the next 2 years, implying a valuation of 10.3x PE FY22 (4.2x EV-EBITDA)  and a dividend yield of 6.0% based on a 60% dividend payout ratio. With more than 33% of the market capitalization in cash, we believe that the management could hike their payout if they do not find suitable acquisition targets.Key Upside Risks
Besides having a great valuation, we believe that upside risk could come from the sector's policy, which Zhen Zhou, Toh has elaborated on in his insight China Property Management Services - Green-Light to Grow.
Shareholder-friendly actions like increasing the payout etc., in the final result. 
Key Downside Risks Incremental tightening on the China property sector could impact VAS income to non-property owners.

Binjiang: Positive Profit Alert, Good Time to Accumulate