港股国泰君安国际SunnyKwokMERRYGARDEN(01237.HK)1012.ppt

CompanyReport,MerryGarden美丽家园(01237HK),GTJAResearch国泰君安研究,25.0,15.0,10.0,5.0,0.0,(5.0),(10.0),企业。,首予“,37.7,10.2,0.4,Company Report:Merry Garden(01237 HK)公司报告：美丽家园(01237 HK),Sunny Kwok 郭日升+852 2509 2642,.hk11 October 2012Fast-Growing Leisure Products Enterprise,Initiate with“Accumulate”快速增长的休闲用品企业，首予“收集”,Merry Garden is a fast-growing wooden leisure products enterprise inthe PRC.The Company has launched a series of wooden leisure products,which include 1)timber villas,sheds and their related parts and structures and2)leisure household products.Wood preservation technologies are applied totimber for improving durability.Domestic sales accounted for 63.7%of MerryGardens total sales in 1H12 and the Company will focus on promoting its“Merry Garden 美丽家园”brand.Merry Garden is expected to be one of the beneficiaries of increasing tourismdemand of Chinese consumers brought by rising disposable income.TheCompany is adding new production lines for capacity expansion to cope withsuch demand and is trying to secure more orders from construction projects.CAGRs of Merry Gardens sales and core net profit are expected to,Rating:评级：6-18m TP 目标价:Share price 股价：Stock performance股价表现,AccumulateInitial收集(首次研究)HK$1.40HK$1.200,reach 30.5%and 32.1%during 2011-2014,respectively.We expect Merry,30.0,%of return,Gardens EPS to increase by 18.5%,36.9%and 24.8%,to RMB0.102,RMB0.140 and RMB0.175 in 2012-2014,respectively.20.0With respect to fast earnings growth expectation and gradual share marketvaluation recovery,current valuation is still attractive despite the fact thatshare price has risen by 20%as compared to the offer price.Therefore,weinitiate“Accumulate”and TP at HK$1.40.The TP represents 11.0 x 2012PER,8.0 x 2013 PER and 6.4x 2014 PER.Major risks areslower-than-expected sales orders growth and an increase in effective taxrate due to High and New Technology Enterprise qualification renewal failure.,美丽家园是一家快速增长的中国休闲木制品企业。公司推出一系列休闲木制品，包括：1),Jul-12,Aug-12HSI,Sep-12Merry Garden,Oct-12,木别墅、小屋及其相关部件及构件和 2)休闲家居用品。公司透过木材保护技术提升木材的耐用性。内销于 12 年上半年占美丽家园总销售额 63.7%，而未来公司将专注于推广其自,有品牌Merry Garden 美丽家园。国内人均可支配收入持续增加推动国内消费者对休闲旅游的需求，美丽家园将为其中一个受惠者。公司正增加生产线扩充产能以满足该等需求及争取更多休闲项目的建筑订单。我们预期美丽家园销售及核心纯利于 2011-2014 年的复合年增长率分别为 30.5%及 32.1%。美丽家园每股净利预期将于 2012-2014 年分别达到人民币 0.102 元、人民币 0.140 元及人,Change in Share Price股价变动Abs.%绝对变动%Rel.%to HS index相对恒指变动%Avg.share price(HK$)平均股价（港元）,1M1 个月13.27.51.2,3M3 个月18.810.71.1,1Y1 年n.a.n.a.n.a.,民币 0.175 元，按年分别增长 18.5%、36.9%及 24.8%。虽然美丽家园股价较上市招股价升幅已达 20%，但在纯利快速增长和市场估值逐渐回升的预期下，现估值不算高。因此，我们首予“收集”的投资评级，目标价为 1.40 港元。目标价相当于公司 12 年、13 年及 14 年市盈率分别为 11.0、8.0 及 6.4 倍。风险为低于预期的销售订单增长及公司未能重续其高新科技企业认证导致其有效税率上升。,Source:Bloomberg,Guotai Junan Int ernat ional.,Year End年结12/31FY10AFY11AFY12FFY13FFY14F,Turnover收入(RMB m)200307426555682,Net Profit股东净利(RMB m)537193140175,EPS每股净利(RMB)0.0650.0860.1020.1400.175,EPS每股净利变动(%)224.133.118.536.924.8,PER市盈率(x)15.711.19.46.95.5,BPS每股净资产(RMB)0.0910.1790.3570.4820.614,PBR市净率(x)11.25.42.72.01.6,DPS每股股息(RMB)0.0000.0000.0150.0420.052,Yield股息率(%)0.00.01.64.45.5,ROE净资产收益率(%)91.464.036.933.331.8,Shares in issue(m)总股数(m)Market cap.(HK$m)市值(HK$m)3 month average vol.3 个月平均成交股数(000)52 Weeks high/low(HK$)52 周高/低,1,000.01,200.03,261.91.270/0.980,Major shareholder 大股东Free float(%)自由流通比率(%)FY12 Net gearing(%)12 年净负债/股东资金(%)FY11-14 PEG(x)市盈率/增长率(倍),Wu Zheyan 45.1%,Source:the Company,Guotai Junan International.,See the last page for disclaimer,Page 1 of 18,11October2012,CompanyReport,MerryGarden美丽家园(01237HK),COMPANY BACKGROUNDA Fast-Growing Wooden Leisure Products Enterprise in the PRC.Merry Garden(“the Company”)is a wooden leisureproducts enterprise in the PRC.The Company has launched a series of wooden leisure products,including:1)timber villas,sheds and their related parts and structures and 2)leisure household products such as outdoor and indoor furniture(woodenchairs and cabinets),recreational products(childrens sandbox products and outdoor playhouse products),landscape gardenproducts(flower carts,railings,and litter bins,etc.)and pet-home designs(wooden rabbit hutches).Merry Garden appliesvarious wood preservation treatments to timber for preservation against fungi,insects and marine borers and the Companys“Merry Garden 美丽家园”brands anti-corrosive wood has been accredited as a Fujian Top Brand.Timber villas salesaccounted for 43.5%of the Companys sales in 1H12(2011:26.5%)and leisure household products accounted for the rest.The Companys products were mainly sold to trading company customers and overseas retail companies on an OEM andODM basis but the Company also explores additional revenue source by launching its“Merry Garden 美丽家园”own-brandedproducts in the PRC market.Sales from OEM business,ODM business and“Merry Garden 美丽家园”accounted for 39.8%,27.3%and 29.8%of the Companys sales for the four months ended 30 April 2012,respectively.In addition,the PRC marketis becoming more important to Merry Garden that domestic sales accounted for 63.7%of the Companys total sales in 1H12,up from 36.2%in 1H11.CAGRs of Merry Gardens sales and reported net profit were 67.1%and 107.7%during 2009-2011,correspondingly.In 1H12,the Companys sales and core net profit increased by 36.8%and 47.3%YoY,to RMB215.9 mn andRMB45.8 mn,respectively.Merry Garden was listed on HKEx on 6 July 2012 at an offer price of HK$1.0.Mr.Wu Zheyan(吴哲彦),the Chairman,holds45.1%equity interest in the Company.In addition,all Pre-IPO Investors(Hong Kong Investments,Haili International,Fu TakInvestments,Great Success and Oceanid Investment)are independent third parties and they hold 32.8%equity interest inMerry Garden.These Pre-IPO Investors are subject to a lock-up period of 6 months from the listing date.Figure-1:Shareholding Structure of Merry GardenSource:the Company.,See the last page for disclaimer,Page 2 of 18,11October2012,CompanyReport,MerryGarden美丽家园(01237HK),2000,2001,2002,2003,2004,2005,2006,2007,2008,2009,2010,2011,2000,2001,2002,2003,2004,2005,2006,2007,2008,2009,2010,2012F,2013F,2014F,2015F,2011,2012F,2013F,2014F,2000,2001,2002,2003,2004,2005,2006,2007,2008,2009,2010,2011,2012F,2013F,2014F,2015F,2015F,INDUSTRY ANALYSISOverview on Tourism Industry in the PRCStrong Tourism Demand of Chinese Urban Residents.CAGRs of total revenue from domestic tourism,the number ofdomestic trips and per capita tourism expenditure in the PRC were 14.8%,10.9%and 3.4%during 2000-2010,respectively.Revenue from domestic tourism in 2011 increased by 23.6%YoY,to RMB1,930.6 bn,which was driven by growth of both thenumber of visitors and per capita spending.The number of domestic trips in the PRC reached 2.64 bn person-times in 2011,up 13.2%YoY,and is expected to be driven by urban residents instead of rural household as demand growth of leisureactivities is stronger for the former than the latter.The number of domestic trips from the urban residents exceeded that of ruralresidents in 2010,the first time in history for this to occur and such trend is not expected to reverse in the future.As urbanresidents tourism expenditure was roughly two times more than that of rural residents,per capita tourism expenditure posteda stable YoY growth of 9.2%in 2011,to RMB731.3 and we expect the growth momentum to continue on growing willingness tospend on leisure activities as well as rising contribution from urban residents.The National Tourism Administration of the PRCexpects CAGRs of domestic trips and revenue from domestic tourism in the PRC to be 8.9%and 11.0%during 2010-2015,respectively but we believe these forecasts are too conservative,given the above forecasts represent per capita tourismexpenditure in the PRC is going to stay flat during the same period.Moreover,according to a report published by the BostonConsulting Group(BCG),a global management consulting firm,in Mar 2011,BCG expects CAGR of Chinese travel spendingto be 13%during 2010-2020.,Figure-2:China Domestic Trips Growth30%25%,Figure-3:China Domestic Tourism Revenue Growth40%30%,20%20%15%10%10%0%5%,0%-5%Source:National Bureau of Statistics of China,National Tourism Administration of the PRC.Figure-4:Per Capita Tourism Expenditure Growthin the PRC15%,-10%-20%Source:National Bureau of Statistics of China,National Tourism Administration of the PRC.Figure-5:Per Capita Tourism Expenditure in the PRC-Urban and Rural ResidentRMB,1,00010%8005%6000%400-5%200-10%,-15%,0,2000,2001,2002,2003,2004,2005,2006,2007,2008,2009,2010,Per capita expenditure-Urban residents,Per capita expenditure-Rural residents,Source:National Bureau of Statistics of China,National Tourism Administration of the PRC.See the last page for disclaimer,Source:National Bureau of Statistics of China.,Page 3 of 18,11October2012,CompanyReport,MerryGarden美丽家园(01237HK),May-11,Nov-11,May-12,May-11,Nov-11,Jan&Feb-11,Jan&Feb-12,May-12,Dec-11,Jun-11,Jun-12,Jul-11,Sep-11,Oct-11,Apr-11,Mar-11,Mar-12,Apr-12,Jul-12,Jul-11,Dec-11,Jun-11,Jan&Feb-11,Oct-11,Jan&Feb-12,Sep-11,Mar-11,May-11,May-12,Nov-11,May-11,Nov-11,Jan&Feb-11,Jan&Feb-12,Jan&Feb-11,Jan&Feb-12,May-12,Jul-11,Oct-11,Apr-11,Dec-11,Apr-12,Jun-11,Mar-11,Mar-12,Sep-11,Jun-12,Jul-12,Jun-11,Dec-11,Sep-11,Jun-12,Apr-11,Apr-12,Jul-11,Mar-11,Oct-11,Mar-12,Aug-11,Aug-11,Jul-12,Mar-12,Aug-11,Aug-11,Jun-12,Apr-11,Apr-12,Jul-12,20%,10%,15%,10%,Development of Tourist Attractions in the PRC to Speed Up.According to a report 2011 年中国旅游景区发展报告published by the National Tourism Administration of the PRC(CNTA),there was a total of 20,976 tourist attractions in the PRCin 2011.Such figure was roughly 35%higher than that in 2002 but could be similar to that in 2006.In order to satisfy robusttourism demand in the PRC,construction of new tourist attractions is expected to speed up.The Chairman of CNTA expectsnew additions of tourism attractions in the PRC to be over 10,000 by 2015.Indirect Beneficiary of Strong Tourism Demand in the PRC.Merry Gardens sales were partially attributable torecreational projects in the PRC by selling timber villas and landscape garden products to tourist attractions.Driven by strongtourism demand in the PRC,we expect development of new tourist scenic spots,rural tourism,leisure clubhouses and privatevillas to speed up.Moreover,timber-made products suit the natural environment better than products made of steel orconcrete.As such,we expect Merry Garden to be an indirect beneficiary of inspiring tourism demand in the PRC.Overview on Wood Processing and Wooden Products Manufacturing Industry in the PRCStable Gross Margin but Slowing Sales and Profit Growth.Weakening economic growth in the PRC,slow economicgrowth in the U.S.and economic recession in the EU negatively affected business development of China wooden productsenterprises.Sales and profit growth of both wood processing and wooden products manufacturing industries in the PRC areslowing but stayed above 20%.Moreover,these industries are not facing huge cost pressure that gross margin stayedrelatively stable as compared to that in 2011.As market for various wooden products is highly fragmented in the PRC,thisleaves huge room for small players market share to grow in the future.,Figure-6:Sales and PBT Growth of WoodProcessing Industry in the PRC80%60%40%YTD Wood Processing Industry Sales GrowthYTD Wood Processing Industry PBT Growth0%Source:National Bureau of Statistics of China.Figure-8:Sales and PBT Growth of Wooden ProductsManufacturing Industry in the PRC60%45%30%YTD Wooden Products Manufacturing Industry Sales GrowthYTD Wooden Products Manufacturing Industry PBT Growth0%Source:National Bureau of Statistics of China.See the last page for disclaimer,Figure-7:Average Gross Margin of WoodProcessing Industry in the PRC25%20%15%Wood Processing Industry Gross MarginYTD Wood Processing Industry Gross Margin5%Source:National Bureau of Statistics of China.Figure-9:Average Gross Margin of Wooden ProductsManufacturing Industry in the PRC25%20%15%Wooden Products Manufacturing Industry Gross MarginYTD Wooden Products Manufacturing Industry Gross Margin5%Source:National Bureau of Statistics of China.Page 4 of 18,11October2012,CompanyReport,MerryGarden美丽家园(01237HK),Overview on Global Timber Villas and Leisure Timber Household Products MarketStronger Demand for Timber Villas and Furniture.ZhongAn Consultant(中 安 盛 业 投 资 谘 询(北 京)有 限 公 司),anindependent market research company in the PRC,released an in-depth market research of China Timber Villas and LeisureTimber Household Products(中国木结构及木质休闲家居用品市场深度调研报告).CAGRs of market size of timber villas andfurniture in the PRC were 26.4%and 31.5%during 2006-2010,respectively,which were higher than CAGRs of market size ofrecreational products,landscape garden products and pet-home designs in the PRC for the same period.CAGRs of marketsize of timber villas and furniture in the PRC are expected to keep outperforming other products in 2010-2016 with thecorresponding growth rate of 16.6%and 16.8%,respectively.In addition,Merry Gardens sales of these two products were thestrongest among alternatives in 2009-2011 and 1H12.Table-1:CAGR of Various Timber Products Market Size in the World,Timber Villas,Together With Their Related Parts,Value in 2010(US$billion),CAGR during2006-2010,CAGR during2010-2016,Market Size the PRC(RMB billion)Export Value the PRC(RMB billion)Import Value the PRC(RMB billion)Market Size North AmericaMarket Size EuropeMarket Size Asia-Pacific(exclusive of the PRC),6.810.281.292.463.561.68,26.4%10.2%8.1%21.1%36.3%49.1%,16.6%24.5%17.2%17.8%17.5%15.9%,Timber-Made Outdoor and Indoor Furniture,Market Size the PRC(RMB billion)Export Value the PRC(RMB billion)Market Size North AmericaMarket Size EuropeMarket Size Asia-Pacific(exclusive of the PRC),190.9510.5680.74116.9060.02,31.5%16.4%10.6%24.5%28.4%,16.8%2.8%17.5%17.3%15.4%,Timber-Made Recreational Products,Market Size the PRC(RMB billion)Export Value the PRC(RMB billion)Market Size North AmericaMarket Size EuropeMarket Size Asia-Pacific(exclusive of the PRC),0.200.360.220.320.21,18.8%45.4%7.2%20.6%27.4%,10.4%21.3%18.4%18.2%17.5%,Timber-Made Landscape Garden Products,Market Size the PRC(RMB billion)Export Value the PRC(RMB billion)Market Size North AmericaMarket Size EuropeMarket Size Asia-Pacific(exclusive of the PRC),0.410.740.450.650.43,19.4%45.8%7.5%21.0%27.5%,10.0%20.9%18.1%17.8%17.1%,Timber-Made Pet-Home Designs,Market Size the PRC(RMB billion)Export Value the PRC(RMB billion)Market Size North AmericaMarket Size EuropeMarket Size Asia-Pacific(exclusive of the PRC),0.481.270.691.000.68,20.2%3.1%-0.3%12.2%17.3%,15.3%12.2%13.7%13.4%11.7%,Source:ZhongAn Consultant,Guotai Junan International.,See the last page for disclaimer,Page 5 of 18,11October2012,CompanyReport,MerryGarden美丽家园(01237HK),FINANCIAL ANALYSISFocus on Domestic Sales.OEM business and overseas sales accounted for more than 80%of Merry Gardens sales in 2009but the Company is shifting its focus towards self-owned brand“Merry Garden 美丽家园”sales and domestic sales.Theformer and the latter accounted for 29.8%and 56.8%of Merry Gardens sales in 4M12,respectively.Revenue Analysis Timber Villas,Sheds and Their Related Parts and Struc